VLSI MARKET IN INDIA

We are living in an era where we are always surrounded by electronic gadgets. Be it mobile phones, cameras, laptops, or medical devices, everything has an electronic chip inside it. The process of manufacturing these chips is called Very Large Scale Integration (VLSI). The electronic chip design market is directly affected by the increase or decrease in the demand for electronic devices.

The number of electronic devices is increasing manifold by the day. With the increase in population, everyone wants these devices which leads to an increase in their production and ultimately VLSI chips. Also, the needs of different individuals are different. Someone may want a low-end phone with good battery life while someone else might want one with a good camera and high processor speed. This leads to an increase in the number of devices being manufactured.

Technology is fast-changing. With higher speeds of processors and lower power consumption, newer devices are always needed to replace old ones. Newer technologies like artificial intelligence and machine learning require newer and faster hardware to function well. WIth automation (IoT) and precision being the need of the hour, more sophisticated and application-specific chips need to be designed and manufactured. All these factors ensure that the design and production of VLSI chips is not going to get obsolete; it's only going to grow leaps and bounds.

VLSI industry growth in our country is booming due to new Government policies to boost the electronic industries and to promote domestic manufacturing under the 'MAKE IN INDIA' project. Moreover, the Ministry of Skill Development and Entrepreneurship (MSDE) is promoting the VLSI domain greatly too.

The IMF projected a sharp contraction of 4.5% for the Indian economy but even after such predictions, why so many companies are investing in India?

The China Factor: Due to Covid-19, a cold war has started between the USA and China due to which many electronic companies are relocating their facilities out of China. For eg- A major manufacturer of Apple is shifting 6 production lines from China to India with a target to export around $5 billion worth of iPhones. Similarly, Wistron, Pegatron, Foxconn and Samsung are also thinking of expanding their manufacturing facilities in India.

Future for Electronics Manufacturing in India: India is already the 2nd largest mobile phone manufacturer in the world. To attract more electronic manufacturing companies and to create an ecosystem, the Indian Government has recently announced a production-linked incentive scheme. With such financial assistance, companies will produce mobile phones and components worth $153 billion during this five-year period and 60% of these products will be exported to other countries. Also, companies have agreed to offer direct and indirect employment to 1.2 million Indians.

These reasons show a clear picture of India being poised to become an Electronics Manufacturing hub which again paves the way for a huge VLSI market in India across the globe. With many aids and assistance given by the Indian Government such as Atma Nirbhar Bharat (Self-reliant India) and many other schemes to promote the manufacturing units, India's electronics exports may rise up to $180 billion by 2025.