Mains – 4th Nov 23
Semiconductor Industry
Why in News?
- Prime Minister Narendra Modi attended the 2nd edition of the SemiconIndia Conference2023, held in Gandhinagar, Gujarat.
About Semiconductors and ICs:
- Semiconductors and displays are the foundation of modern electronics industry.
- Semiconductors are critical components that power electronics from computers and smartphones to the brake sensors in cars.
- Semiconductors and display manufacturing is a very complex and technology-intensive sector.
- It involves huge capital investments, high risk, long gestation and payback periods, and rapid changes in technology, which require significant and sustained investments.
Need for Domestic Manufacturing of Semiconductors:
- As India does not produce any semiconductors, the country’s demands are met with imports.
- The demand for semiconductors in India will reportedly reach around USD 100 billion by 2025, up from the current demand of USD 24 billion.
- Also, absence of local manufacturing affected India the most during the lockdown imposed due to the Covid-19 pandemic.
- During this period, there was a global surge in the demand for electronics.
- In the current geopolitical scenario, trusted sources of semiconductors and displays hold strategic importance and are key to the security of critical information infrastructure.
Challenges Faced by the Semiconductor Industry:
- Supply Chain Disruptions –
- This is caused by a combination of factors including the Covid-19 pandemic, the ongoing geopolitical tensions and significant trade disputes which exacerbate the severe chip shortage globally.
- Dependence should be reduced on the limited number of manufacturing hubs by strengthening domestic capabilities and production at home.
- Technological Complexity & Miniaturization –
- It’s not a race to the bottom but more of a race to the smallest.
- The industry is on a relentless pursuit of miniaturization which is considered to be the main driving force behind the industry’s remarkable progress and growth.
- Moore’s Law, which states that the number of transistors on a chip double approximately every two years highlights the pressure to constantly innovate and ensure quality control, yield improvement, and time-to-market.
- This of course has to be delicately balanced between pushing technological boundaries and ensuring cost-effective and reliable production.
- Talent Shortage & Skill Gap –
- Another major challenge for the industry is the widening gap between demand for skilled professionals and the availability of qualified individuals.
- Advancements of semiconductor technologies have come at sometimes breakneck speed and there is serious competition to attract the right talent within the semiconductor industry.
Major Incentives approved by the Cabinet for the Sector:
- In December 2021, the Central government had approved the comprehensive program for the development of sustainable semiconductor and display ecosystem in the country. This includes:
- India Semiconductor Mission –
- The Mission will be led by global experts in semiconductor and display industry to drive the long-term strategies for developing a sustainable semiconductors and display ecosystem.
- It will act as the nodal agency for efficient and smooth implementation of the schemes on Semiconductors and Display ecosystem.
- Semiconductor Design Companies –
- Support will be provided to 100 domestic companies of semiconductor design for Integrated Circuits (ICs), Chipsets, System on Chips (SoCs), etc.
- The scheme intends to facilitate the growth of not less than 20 such companies which can achieve turnover of more than Rs. 1500 crore in the coming five years.
- Semiconductor Fabs and Display Fabs –
- The Scheme for Setting up of Semiconductor Fabs and Display Fabs in India shall extend fiscal support of up to 50% of project cost.
- Central Government will work closely with State Governments to approve applications for setting up at least two greenfield semiconductor fabs and two display fabs in the country.
- Compound Semiconductors and Semiconductor Packaging –
- The Scheme for setting up of Compound Semiconductors / Silicon Photonics / Sensors Fabs in India shall extend fiscal support of 30% of capital expenditure to approved units.
- At least 15 such units of Compound Semiconductors and Semiconductor Packaging are expected to be established with Government support under this scheme.
- Fiscal Support –
- The Central Government has announced incentives for every part of supply chain including electronic components, sub-assemblies, and finished goods.
- The Government has committed support of Rs. 2,30,000 crore (USD 30 billion) to position India as global hub for electronics manufacturing with semiconductors as the foundational building block.
Progress so far:
- So far, three applicants — a Vedanta-Foxconn joint venture, international consortium ISMC and Singapore-based IGSS Ventures — have been approved for setting up semiconductor fabs.
- The Vedanta-Foxconn joint venture recently signed an agreement with the Gujarat government for setting up a USD 20 billion semiconductor and display manufacturing plant in the state.
- However, recently, Foxconn announced that it is no longer a part of the joint venture.
Fukushima Water Issue
Why in news?
Japan’s controversial plan to release treated waste water from the Fukushima nuclear plant into the Pacific Ocean has sparked anxiety and anger at home and abroad.
Fukushima Disaster
- The Fukushima Daiichi Nuclear power plant suffered a meltdown in 2011 after a massive earthquake and tsunami, releasing large amounts of radioactive materials into the environment.
- Since the disaster, power plant company Tepco has been pumping in water to cool down the Fukushima nuclear reactors’ fuel rods. This means every day the plant produces contaminated water, which is stored in massive tanks.
- More than 1,000 tanks have been filled, and Japan says that it needs the land occupied by the tanks to build new facilities to safely decommission the plant. It has also pointed out concerns that the tanks could collapse in a natural disaster.
- Releasing treated waste water into the ocean is a routine practice for nuclear plants – though critics have pointed out that the amount from Fukushima is on an unprecedented, far vaster scale.
- Though Japan filters the Fukushima water which reduces most radioactive substances to acceptable safety standards, apart from tritium and carbon-14. Tritium and carbon-14 are, respectively, radioactive forms of hydrogen and carbon, and are difficult to separate from water. They are widely present in the natural environment, water and even in humans, as they are formed in the Earth’s atmosphere and can enter the water cycle.
Viewpoint of Critics
- Critics say Japan should, for the time being, keep the treated water in the tanks. They argue this buys time to develop new processing technologies, and allow any remaining radioactivity to naturally reduce.
- China has been the most vocal, accusing Japan of violating “international moral and legal obligations” and “putting its selfish interests above the long-term wellbeing of the entire humanity”.
International Atomic Energy Agency
- IAEA is an intergovernmental organization that seeks to promote the peaceful use of nuclear energy and to inhibit its use for any military purpose, including nuclear weapons.
- It was established in 1957 as the world’s “Atoms for Peace” organization within the United Nations family, and governed by its own founding treaty, the Statute of the IAEA.
- It reports to both the UN General Assembly and the UN Security Council, and is headquartered at the UN Office at Vienna, Austria
- In 2005, it was awarded the Nobel Peace Prize for their work for a safe and peaceful world.