Japanese firms keen to set up semiconductor units in India: Deloitte

Japanese firms are keen to set up semiconductor units in India and they have all the expertise and specialisation to partner with domestic firms, Deloitte has said.

It also said that a skilled workforce, funds and continuation of support measures are key to pushing the growth of the semiconductor sector in India.

Japanese firms are "super enthusiastic" about India, Shingo Kamaya, Deloitte AP and SRT Leader, Deloitte Japan said.

In July, Japan became the second Quad partner after the US to sign an agreement with India for the joint development of the semiconductor ecosystem and maintain the resilience of its global supply chain.

The two countries signed the memorandum for semiconductor design, manufacturing, equipment research, talent development and to bring resilience to the semiconductor supply chain.

With around 100 semiconductor manufacturing plants, Japan is among the top five countries to have a semiconductor ecosystem.

Japan houses companies that are global leaders in the raw form of semiconductor wafers, chemicals and gases, lenses that are used in chip manufacturing equipment, and display technologies.

India aspires to have 10 semiconductor manufacturing plants in 10 years.

"Given the technology, given the specialization, there is no better partner to get on to developing such an ambitious and a critical ecosystem of semiconductor than Japan," Rohit Berry, President - Strategy, Risk and Transactions, Deloitte India, said.

He said that the semiconductor story in the country is not just about setting up one factory, but it is about that entire ecosystem.

"And that is where many Japanese companies who have set up such ecosystems in Japan or in any other places are going to be absolutely critical to set it up (in India). So this is the vision. This is a grand plan. This is the investment. This is the commitment," he added.

Berry also said that developing the right kind of partnerships between Indian and Japanese firms is fundamental for the growth of the sector.

"This is not a one-year game, it's not a two-year game. This will basically benefit us and Japan for generations," he noted.

He also emphasised that the government incentive program on a sustained basis will also be a key factor for the sector's growth in India.

When asked if Japanese firms are looking for any specific support measures from states, he said that a "centre-state partnership, together with the private and Japanese partnership, all four of them coming together will be a prerequisite to creating a once-in-a-lifetime-setup".