Documente Academic
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December 2008
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Se m i c o n d u c to r
December 2008
Contents
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Semiconductor
Sector – Overview
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Se m i c o n d u c to r S e c to r –Overview
December 2008
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Se m i c o n d u c to r S e c to r –Overview
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Se m i c o n d u c to r S e c to r –Overview
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2004 2.1
2003 1.6
0 1 2 3 4 5 6
US$ billion
Source: ISA 2007 report, F&S
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Se m i c o n d u c to r S e c to r –Overview
December 2008
Accrding to an ISA 2007 report, the Indian Percentage Share of the Indian Semiconductor Market in
the Global Semiconductor Market (2006-09)
semiconductor market has grown from approximately
2009E 1.62
US$ 2.6 billion to approximately US$ 4.1 billion. 2008E 1.42
The semiconductor market is expected to grow from 2007E 1.27
US$ 2.7 billion in 2006 to US$ 5.5 billion in 2009. 2006 1.09
The country accounted for 1.09 per cent of the global 0.00 0.35 0.70 1.05 1.40 1.75
semiconductor revenue in 2006 and this share is Source: ISA 2007 report F&S
Percentage
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Se m i c o n d u c to r S e c to r –Overview
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Se m i c o n d u c to r S e c to r –Overview
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• The IT and Office Automataion segment along Total Semiconductor Product Market in 2006
with the telecom segment dominate the demand
8% 8%
for semiconductor products in India. These two 3% 2%
6%
segments control more than 75 per cent of the 6%
8%
total semiconductor requirement in the country. 7%
44%
46%
• The telecom segment is the largest application
segment contributing to the semiconductor market. 30%
According to ISA, it registered a market share of 32%
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Se m i c o n d u c to r S e c to r –Overview
December 2008
14.4 billion and US$ 43.1 billion by 2010 and 2015, 2008E 8.6
2007E
respectively. During 2005–2015, it is expected to 6.6
2006E 4.6
register growth at a CAGR of approximately 29.5 per 2005 3.3
cent. 2004 2.4
0 5 10 15 20 25 30 35 40 45 50
US$ billion
Source: ISA 2007 report, F&S
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Se m i c o n d u c to r S e c to r –Overview
December 2008
The growth in the Indian semiconductor design market Engineering Workforce Employed by Indian
Semiconductor Design Market
is expected to lead to growth in the engineering
2015E
workforce employed by this segment. According to the 0.78
2014E 0.65
ISA, it employed an estimated 0.13 million engineers 2013E 0.55
in 2007 and the employment figure is likely to grow to 2012E 0.45
0.29 million by 2010 and 0.78 million by 2015, growing 2011E 0.36
2008E 0.18
2007E 0.10
2006E 0.10
2005 0.07
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Se m i c o n d u c to r S e c to r –Overview
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Se m i c o n d u c to r S e c to r –Overview
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India is attracting a large Various semiconductor Many domestic and foreign Many multinational
number of VCs to invest in consuming sectors, such start-ups are coming into the semiconductor companies
the domestic semiconductor as digital media, consumer picture and expanding their have also started either
design segment. The country electronics, auto and wireless, operations in the country. offshoring their developing
is now becoming a preferable are demanding devices with Currently, it is not difficult to and designing work to India
destination for VC firms due multi-features having different establish a start-up unit, as or opening their own captive
to factors such as availability technologies on a single financing schemes for these centres in the country. These
of skilled labour, strong local platform. Further, the growth start-ups are available in the designing companies in India
market and flexible regulatory of mobile applications is country. This trend will firmly are now moving up the value
framework of the IT ministry. driving the combination of embed India on the global map chain by moving from low
microprocessors and digital in the field of semiconductor end-to-end design activities to
signal processors in order designing. front-end design work.
to take advantage of both
technologies.
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Semiconductor
An Upcoming Sector
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Se m i c o n d u c to r – A n Upcomin g Sector
December 2008
electronics and durables, IT hardware and office 2006 121.9 378.4 1000 1884.3 186.9
2007 145.9 471.4 1280 3010 245.4
automation, telecommunications, etc. 2010E 240.2 791.1 2610 7980.8 484.7
2015E 459.5 1529.5 6960 24297.2 1647.6
requires a large pool of engineering workforce. 2005 74,850 60,220 11,300 3,330
2006E 102,120 83,500 14,200 4,420
Here, India has an edge over other countries owing 2007E 140,235 116,305 18,060 5,870
to its large talent pool. 2008E 178,675 148,790 22,300 7,584
2009E 227,265 190,030 27,455 9,780
2010E 286,220 241,000 33,135 12,085
2011E 360,440 305,665 39,850 14,925
2012E 454,010 387,665 47,910 18,436
2013E 545,665 465,196 57,700 22,770
2014E 653,365 558,236 67,000 28,130
2015E 781,780 669,885 77,150 34,745
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Se m i c o n d u c to r – A n Upcomin g Sector
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Se m i c o n d u c to r – A n Upcomin g Sector
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Regulatory Framework in the
Semiconductor Sector
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Reg ulato ry F r a m e wo r k in Semiconductor Sector
December 2008
Regulation of NSP
The threshold investment for a semiconductor
manufacturing (wafer fabs) plant would be US$ 575
million (approx.) and US$ 220 million (approx.) for
other ancillary units (storage devices, organic LED, micro
or nano-technology products).
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Reg ulato ry F r a m e wo r k in Semiconductor Sector
December 2008
The policy covers State 20 per cent Assuming a 1:1 In case of units In case of units
LCDs, storage Governments can of the capital debt to equity located outside located outside
devices, plasmas, provide additional expenditure of a ratio for the the SEZ, the an SEZ, the
photo-voltaics, incentives to semiconductor project, the Countervailing government will
solar cells and semiconductor manufacturing government Duties (CVD) on bear 25 per cent
nanotechnology companies. unit located in a restricts its capital goods will of the capital
products, and Special Economic participation to be exempted. expenditure for
also includes Zone (SEZ) will 26 per cent of the stated time
assembly and be borne by the the equity capital. duration.
testing of these government for
products. the first 10 years.
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