A new direction is opening for India in silicon chip sector

- 3 nanometer processors are considered the most advanced and powerful

- Occasional

- Indian industries prioritize development of green energy capacity over chip manufacturing

The battle over the integrated circuit or silicon chip has entered a new phase. China currently lacks the capacity to design and manufacture such chips. The restrictions are extensive. The scope of these restrictions is U.S. Also covers allies and their companies, as they depend in one way or another on US technology. That would make it difficult for Taiwan's TSMC or South Korea's Samsung to sell cutting-edge chips to help China. China has always been a big customer for TSMC and Samsung.

The move comes as a blow to Chinese President Xi Jinping, who had laid out a plan that envisioned China surpassing the US in a range of technologies and making significant headway in the West. Without access to chips, China's ambitions in artificial intelligence, AI and blockchain will suffer.

It is not at all that China was not aware of such situations, but it must have thought that such situations would not arise suddenly and that it would get a few more years to be ready to develop capabilities in this area. That's why China has used huge financial resources for related technologies to reduce its dependence on Ghibh or Samsung.

Currently 3-nm (nanometer) processors are considered the most advanced and powerful chips. TSMC has mastered its manufacturing and is a leader on this front. Samsung and Intel are also developing their capabilities. All three companies are now working on 2 nm chips. In contrast, the Chinese are several generations behind in chip production capacity. SMIC, China's most famous chipmaker, is also capable of producing 7-nm chips so far. Other companies are only able to manufacture older chips. Although Chinese companies have long been involved in chip manufacturing efforts in the U.S. And its allies still have the lead on this front.

So will China be left behind in chips forever? Much of China's technology has been created by people who went to the US to study and gain experience working for large American or Western tech companies. Most of these entrepreneurs are Chinese by birth. They will now likely be forced to choose between China or the US due to the US administration's sanctions.

China has been rapidly promoting technological research in universities for some time now. That it lags behind American and European research in many areas does not mean that China cannot compete on this front.

Japan and Korea are broadly supportive of the US, along with most European countries and Australia. Japan and many European countries that depend on Taiwan for chip fabrication are now intensifying their capabilities to reduce dependence on the US, South Korea and Taiwan.

As for India, despite being a huge economy, it lags far behind in this important sector. We are taking small steps in this direction. So far, plans for chip manufacturing have surfaced in the Vedanta-Foxphone partnership. In which such an advanced chip will not be made.

The government has made indigenous chip capabilities a priority. The government has also taken several steps in this direction. These include initiatives ranging from production linked incentives to assistance in setting up plants in India and licensing of 28 h fabrication technology from abroad. These are certainly good steps, but not enough given India's aspirations. The next step for the country should be to move towards the chip value chain. Active participation of private sector will be necessary for this. So far India's largest industry chip-maker has been focusing more on developing green energy capacity. Our weakness in this regard will not go away until the industry becomes active on the chip manufacturing front.