India Must Act Swiftly to Counter China's Chip Industry Advancements

US lifting chip software curbs on China puts India on alert, experts say. India needs to accelerate its domestic chip design capabilities amid increasing competition from China. The US reversal allows EDA software companies to resume full engagement with Chinese entities, creating increased competitive dynamics for India's EDA sector and wider electronics industry. India must move faster on chip design, building its own chip design software and investing in R&D, IP, and deep skilling.

The United States has lifted restrictions on the sale of Electronic Design Automation (EDA) software to China, which has put India on high alert. Experts are urging the country to accelerate its domestic chip design capabilities to keep up with the increased competition from China [1].

The US reversal, which came after restrictions imposed by President Donald Trump, allows leading EDA software companies such as Cadence Design Systems, Siemens EDA, and Synopsys to resume full engagement with Chinese entities. This move has created increased competitive dynamics for India's EDA sector and the wider electronics industry [1].

India, which accounts for 20% of global semiconductor design engineers, is currently focusing on mature nodes that account for 75-80% of market demand. However, the country aims to create an end-to-end value chain ecosystem in the medium term. Experts believe that India must move faster on chip design, building its own chip design software and investing heavily in R&D, intellectual property (IP), and deep skilling [1].

Ruchir Dixit, chairperson of the India Electronics & Semiconductor Association (IESA) board of directors, highlighted that none of the beneficiaries of the government’s Design-Linked Incentive (DLI) scheme are EDA companies. He emphasized that India must invest in EDA to stay competitive [1].

The US decision, while fostering greater stability in global tech trade, has also signaled a more competitive environment for India's semiconductor aspirations. The consensus among experts is that India must leverage this stability to further its own domestic capabilities, invest heavily in R&D and skill development, and solidify its position in the global semiconductor landscape [1].

Moreover, Apple, one of the major tech companies, is also diversifying its production out of China and looking at India as an alternative. However, hundreds of Chinese technology professionals working at Foxconn's India plant have returned to China, which could potentially impact the production of the upcoming iPhone 17 series [2].

In conclusion, the lifting of US chip software curbs on China has created a competitive environment for India's semiconductor industry. The country must act swiftly to accelerate its domestic chip design capabilities, invest in R&D, and build its own chip design software to stay competitive in the global market.

References:
[1] https://m.economictimes.com/tech/technology/us-move-to-lift-chip-software-curbs-on-china-puts-india-on-alert/articleshow/122391334.cms?UTM_Campaign=RSS_Feed&UTM_Medium=Referral&UTM_Source=Google_Newsstand
[2] https://www.business-standard.com/industry/news/apple-iphone-india-production-foxconn-chinese-professionals-125071100665_1.html