The new US-India technology partnership forged during recent v | StudY LoveR VeeR (SLV) Official✅
The new US-India technology partnership forged during recent visit of Indian PM to Washington DC identifies technology as the new geopolitical frontier.
A key element of the partnership is the resolve to diversify the global semiconductor supply chain, which is at the centre of the rivalry between the world’s two biggest economic powers, the US and China.
Semiconductor and its Importance
Semiconductor: It is usually comprised of silicon, which conducts electricity more than an insulator, such as glass, but less than a pure conductor, such as copper or aluminium.
Importance
Also known as semis/chips, semiconductors can be found in thousands of products such as computers, smartphones, appliances, gaming hardware, and medical equipment.
They are essential to almost every modern device, from a phone to advanced defence systems, and advanced artificial intelligence-powered machines.
But only a few countries are in the business of making chips, among the world’s most advanced technologies, and some specialise only in some aspects of it.
20th century was dominated by oil. In the 21st century Chips are the new oil.
US-China War on Semiconductors
Since 2020, the US has taken several steps aimed at
Denying semiconductor technology to China to prevent it from gaining high tech dominance over the world.
Pumping up its own domestic capacity for making chips.
For example, the Trump Administration listed the Chinese telecom giant Huawei and several ancillaries as a threat to US national security, and the Biden Administration retained restrictions on Huawei.
In 2020, China was the biggest market for semiconductor machines. Beijing’s “Made in China 2025” plan, launched in 2019 had prioritised achieving self-sufficiency in semiconductors.
But the export controls set in motion by the US and more are in the pipeline have made China’s mission look difficult.
In a retaliatory move, China has banned the US chipmaker company Micron from vital infrastructure projects.
In 2022, the US Congress passed the CHIPS and Science Act, providing $280 billion in new funding for domestic research and manufacturing of semiconductors in the US.
Current State of Chip Wars
Japan has also announced restrictions on semiconductor exports to China. The Japanese restrictions will take effect from July. China has warned of “consequences”.
As US works with key partners to restrict Chinese access to chip tech, China’s chip imports from Japan, South Korea and Taiwan, part of the US-led “Chip 4 Alliance”, fell by 20 per cent in the first five months of 2023.
US is also lobbying the Netherlands to take similar steps; the Dutch company ASML is the only maker in the world of deep ultraviolet lithography machines that are required to make certain kinds of chips.
Opportunities for India from the Ongoing Chip War
India is pushing itself as an alternative to China. India is aspiring for turning the ongoing war into its advantage.
India does not have native semiconductors firm but it is trying to attract foreign chipmakers companies by providing them incentives and various other benefits.
To realise this plan the government has announced a 10 billion dollars incentive plan which aims to boost manufacturing of semiconductors in India.
This is India’s chance to be a global player in the semiconductor sector, but success is not guaranteed.
India’s government must provide its homegrown industry with the needed help, both financially and material-wise, and strike the right balance between accepting U.S. partnership while not letting Washington dictate terms.
