India and the United States have recently agreed to form a semiconductor sub-committee, as part of their efforts to increase private-sector cooperation in the area of semiconductors with the aim of reducing their dependence on China and Taiwan. The Semiconductor Sub-Committee is led by the Department of Commerce for the US side and the Ministry of Electronics and Information Technology (MeitY) and the Ministry of Commerce and Industry for the Indian side. This initiative is a result of the signing of a Memorandum of Understanding (MoU) between India and the US to build a resilient supply chain in the semiconductor sector.
Semiconductors are the building blocks of almost every modern electronic device, from smartphones to connected devices in the Internet of Things (IoT). The chip-making industry is highly concentrated, with the major players being Taiwan, the US, and China. The global chip shortage, coupled with the US-China tensions over Taiwan and supply chain blockages owing to the Russia-Ukraine conflict, have made major economies realize the importance of the chip-making sector.
Importance of the Semiconductor Sub-Committee
The setting up of the Semiconductor Sub-Committee is significant as it aims to reduce India’s dependence on China and Taiwan for semiconductors. It also provides a platform for both countries to leverage their complementary strengths and facilitate commercial opportunities and the development of semiconductor innovation ecosystems through discussions on various aspects of the semiconductor value chain.
Indian Initiatives
In 2021, the MeitY launched the Design Linked Incentive (DLI) Scheme to nurture at least 20 domestic companies involved in semiconductor design. The Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) was also launched for the manufacturing of electronic components and semiconductors. Additionally, India has announced an outlay of Rs 76,000 crore (around $10 billion) under the PLI scheme for the development of a semiconductor and display manufacturing electronics ecosystem.
MCQs about Semiconductor Sub-Committee
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What is the purpose of the Semiconductor Sub-Committee formed by India and the US?
A. To reduce their dependence on China and Taiwan for semiconductors and increase private-sector cooperation in the area of semiconductors.
B. To increase their dependence on China and Taiwan for semiconductors and reduce private-sector cooperation in the area of semiconductors.
C. To increase Russia’s dependence on India and the US for semiconductors and reduce private-sector cooperation in the area of semiconductors.
D. To increase Taiwan’s dependence on India and the US for semiconductors and reduce private-sector cooperation in the area of semiconductors.
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Which Indian scheme was launched in 2021 to nurture at least 20 domestic companies involved in semiconductor design?
A. Design Linked Incentive (DLI) Scheme
B. Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS)
C. PLI Scheme
D. Semiconductor Sub-Committee
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What is the purpose of the Memorandum of Understanding (MoU) signed between India and the US in the semiconductor sector?
A. To build a resilient supply chain in the semiconductor sector.
B. To increase China’s dependence on India and the US for semiconductors.
C. To increase Taiwan’s dependence on India and the US for semiconductors.
D. To reduce private-sector cooperation in the area of semiconductors.
