India aims to become a chip design hub

Despite the many hiccups, India has taken quiet but tentative steps towards indigenous chip design capabilities for a few years now as it views indigenous chip development as a strategic necessity.

We have made several attempts to build a semiconductor manufacturing ecosystem, including with leading chipmakers AMD and TSMC to build factories across the country, in line with global thinking in which countries realize that local chip development helps protect their strategic interests.

China, for example, is building a domestic chip program to use local semiconductors in 70% of its products by 2025, up from 16% currently.

India, for its part, is seeking to create a homegrown fabless semiconductor design ecosystem and tap into local talent, helping to nurture academic institutions and startups.

       The idea is to move away from reliance on global technology companies such as Intel, AMD and ARM for microprocessors, and Qualcomm, Samsung and MediaTek for mobile phones to a parallel path.

       Over the past two decades, many global semiconductor companies such as ARM, Qualcomm, Intel, Cadence, and Texas Instruments have established design and software development infrastructure here, helping to create a large pool of talent that understands chip development.

The government hopes to use this talent to help entrepreneurs conduct research in chip design and the fabless semiconductor ecosystem.

       Taking advantage of this, several companies and academic incubators have sprung up across the country to design and test chipsets, microprocessors, and related technologies that can be used commercially.

       Research and development efforts driven by government-funded academic institutions and local technology entrepreneurs are focused on promoting domestic manufacturing.

       Support has also come in the form of a new policy announced in February aimed at making the country a hub for electronics manufacturing and offering special incentives for exports and high-tech projects including semiconductor facilities.

       Simply put, the policy is about fabless chip design and strategic electronics capabilities, including in the medical, automotive and power sectors.

       In cutting

       The Indian semiconductor components market is expected to be worth $32.35 billion by 2025, growing at a compunded annual rate of 10.1% from 2018 to 2025, according to the Indian Electronics and Semiconductor Association (IESA), an industry body.

       Global semiconductor revenue totaled $476.7 billion in 2018, up 13.4% from 2017, according to preliminary results from technology advisory firm Gartner, Inc.

       IESA has taken some steps to set up an accelerator for fabless semiconductor startups and plans to accelerate 50 such startups within five years.

       IESA president Rajesh Ram Mishra said these startups will help build a critical mass to launch the next wave of companies.

       He said several companies already make small chips that can be used in set-top boxes and solutions using the Internet of Things.

       For example, Bengaluru-based chip company Cirel Systems has designed a small chip that goes into digital pens used in tablets made by multinational companies, and Mishra said the company has produced about 4-5 million such chips.

       Earlier this year, Bengaluru-based niche semiconductor products company Signalchip launched a range of chips called ‘Agumbe’ (after a village in Karnataka’s Shivamogga district) targeting makers of 4G and 5G modems.

       Signalchip is making inroads into the 4G/LTE (Long Term Evolution) and 5G-NR (New Radio) product markets and is funded by Zoho Corporation and its founder and CEO Sridhar Vembu. 4G/LTE and 5G-NR are wireless communication standards that determine the speed of mobile networks.

       Signalchip designs chips that enable high-speed connections but are not used inside phones to receive and convert signals.

Himamshu Khasnis, founder and CEO of Signalchip, said it was vital that India develops indigenous capabilities to design and develop silicon chips as wireless communications have become integral to the country's economic and strategic interests.

       “Silicon chip design is a very challenging activity that requires high-cost R&D, deep expertise and mastery of multiple complex areas.

       So most countries don’t have the technology,” he said. Zoho’s Vembu, who directs Signalchip, agrees.

       “During the decoding and demodulation of signals, there is a possibility that external agencies can exploit the data. The defense community is now more sensitive; the government also wants to know who uses the data for security reasons,” he said.

       However, the market for mobile phone chips is more difficult to penetrate because global tech giants are already entrenched and investors are reluctant to fund long-term research and development projects.

       Take Mymo Wireless as an example.

       The Bengaluru-based company was hatched out of the Indian Institute of Science-Bangalore a decade ago with an aim to transform the Indian microchip industry and emerge as a challenger to US-headquartered Qualcomm.

       The company initially gained expertise in chip manufacturing, focusing on building IP, licensing its technology, and building chips for other companies. This was a strategic decision that helped it earn a steady 30% profit.

       However, it soon realised that chip manufacturing was an expensive proposition. When the company tried to raise $20 million a year ago, no venture capitalist was willing to invest in the endeavour. “Indians lack the risk-taking capacity to invest so much money over a longer period of time. They want to see returns next year,” said co-founder Sondur Madhan Babu. Soon after, it was acquired by an American technologist with a similar vision – to build the next Qualcomm.

       “I am sad that we are no longer an Indian company, but as an entrepreneur I have to think about my business.

The vision at least remains the same,” Babu said.

       The struggle is very similar at Saankhya Labs, another successful Bengaluru-based startup that has been creating chipsets for defence, satellite communications and broadcasting.

       The company has launched a new generation mobile system-onchip, Pruthvi-3, designed for mobile devices, broadcast, satellite and defense communications.

       Saankhya is currently working as a technology partner with ISRO on a project for Indian Railways. It has installed chips in 1,000 locomotives that can track their location accurately for up to 30 seconds.

Still, India’s chip sector hasn’t really taken off due to a lack of venture capital interest and funding from hardware and product companies, said co-founder and CEO Parag Naik.

       “It’s also not the kind of business you can build out of college — you need some industry experience, have to get some grey hair first,” he said. “There’s a huge perception war. We’ve spent a lot of time combating the idea that you can’t build a tech business in India.”

       For example, Samsung Electronics, the largest semiconductor supplier, became the top supplier in 2018, and the total revenue of the top 25 semiconductor suppliers increased by 16.3% in 2018, accounting for 79.3% of the market, according to Gartner data.

       In comparison, revenue growth in other markets was 3.6%.

       Professor's Toys

       There are basically two types of chips - semiconductors that require large investments, and smaller chips used in products such as energy meters, LED lighting, smart cards and rural broadband.

       Academia, largely funded by the government, is developing core technologies, particularly in the area of ​​microprocessing, dominated by multinational corporations such as Intel, AMD and ARM.

       Earlier this year, a team from IIT Bombay unveiled a chip designed entirely in-house, AJIT, which is being tested for use in GPS receivers being developed for India's own satellite navigation system, NAVIC.

       NAVIC is the operational name of India's regional navigation satellite system, which provides accurate real-time positioning and timing data and was originally developed for hostile situations where access to foreign satellite systems could not be guaranteed.

       Madhav Desai, professor of electrical engineering at IIT-B, who is working on the digital aspect of the project, said the processor design at AJIT is complete and SoCs based on the processor are already receiving attention from the industry.

       “If NAVIC is successful, there are 2-3 companies keen to commercialise it. We see June 2020 as a timeline for commercial production. Given the indigenous origin of the technology, there is enough interest,” he said.

       At its counterpart at IIT Madras, the microprocessor program Shakti is also in full swing. Led by Kamakoti Veezhinathan, a professor in the Department of Computer Science and Engineering, Shakti aims to reduce dependence on foreign computing resources and mitigate the risk of cyberattacks.

       Shakti microprocessors can be used in mobile computing devices, embedded low-power wireless systems such as smartphones, surveillance cameras and networking systems.

       Shakti can also help reduce the risks associated with deploying external systems that may be infected with backdoors and hardware Trojans. Shakti is built using open source architecture and companies are very interested in strategic applications. The team has also developed an advanced microprocessor called "Parashakti" for supercomputers.

       In Pune, the Centre for Development of Advanced Computing (C-DAC), a government-funded research institute, is designing India's 64-bit quad-core microprocessor as well as an exascale computing system with a computing power of one exaflops, or one billion calculations per second.

       “We are working towards a viable exascale computing architecture by 2022. This will bring about many disruptive technologies,” Hemant Darbari, director general of C-DAC, told ET in a recent interview.