Topic: Semiconductor Fabrication in India
Why in News: Concerns are raised over the under-utilization of funds in production-linked incentives (PLI) for semiconductor manufacturing in India, highlighting the need for clearer goals and effective utilization of resources.
Key Facts for Prelims:
The PLI scheme for IT hardware has an outlay of ₹17,000 crore, and for semiconductors and displays, it is ₹38,601 crore.
The focus is on increasing semiconductor fabrication capabilities in India.
There's an 80% under-utilization of allocated funds for semiconductor PLI.
Semiconductor manufacturing employs advanced automation, leading to relatively low direct employment compared to the value generated.
Analysis for Mains:
Strategic Importance: Semiconductor fabrication is crucial for India’s technological advancement and self-reliance.
Example: Dependency on foreign chips during the pandemic highlighted the need for domestic production.
Economic Impact: The PLI scheme is aimed at boosting the electronics manufacturing sector but shows limited success in attracting major investments.
Case Study: The underutilization of PLI funds and lack of substantial commitments from multinational chipmakers.
Policy Challenges: The need for a clear strategy in allocating resources amidst rapidly advancing technology like AI.
Policy Analysis: A focus on assembly and large manufacturing plants with heavy reliance on imported materials.
Goal Clarity: The necessity for the government to define tangible outcomes - whether it's cyber sovereignty, consumer benefits, or global manufacturing dominance.
Implication: This clarity can aid in recognizing failures and implementing timely course corrections.