This becomes relevant to the global electronics supply chain when you consider that more and more global companies are moving manufacturing to India. A survey from BCG released earlier this year said that more than 90% of the North American manufacturers relocated some production from China in the past five years — and a similar percentage plan to make such moves over the next five years. India has emerged as one of the prime destinations for these companies.
“This shift brings with it the entire supply chain,” said Varun Manwani, CEO of Sahasra Semiconductors, another OSAT entrant. “A prime example is Apple, which initially brought in its EMS. Recent reports suggest TDK plans to do the same for battery packs. This progression indicates a movement towards establishing a comprehensive component-level ecosystem within the country.”
Local OSAT advancements could also disrupt the fabless business sector, leveraging India’s strong engineering and design capabilities that have spawned numerous startups. Manwani pointed out the challenge these companies face without an integrated chip packaging ecosystem.
“Previously, they all had to return to the US, Taiwan, etc., for packaging,” Manwani said. “Now, they’re also exploring opportunities with Indian providers. This shift is not only beneficial for us but also for them, as partnering with companies overseas for packaging incurs significantly higher costs. By collaborating with an Indian company, these costs can be substantially reduced, and timelines can be improved as well. Consequently, this represents a customer base within India that we have access to and are currently engaging in discussions with.”
From India to the global market
While acknowledging India’s market potential, companies such as Sahasra are casting a wider net, tapping into security, surveillance lighting, and IP hardware sectors in markets such as Belgium and the US. Panicker and Gupta also emphasized the importance of a dual-focused strategy, balancing local and international opportunities.
“Targeting solely the Indian market will not likely result in large-scale success,” Gupta said. “Typically, a business in semiconductor manufacturing, be it fabrication or packaging, should aim for a market distribution of about 70 percent global and 30 percent Indian. Relying exclusively on the Indian market might not lead to success, as the requirement for high-end packaging in India may exceed the capabilities of a new entrant.”
