Semiconductor manufacturing
Source: By Pranav Mukul: The Indian Express
Mumbai-based conglomerate Tata Group, which has already forayed into manufacturing of hi-tech electronics, is now planning to get into semiconductor manufacturing. The move comes at a time when the Covid-19 pandemic caused and later exacerbated a global shortage of chips and semiconductors.
Tata Sons Chairman N Chandrasekaran said recently: “At the group, we have already set up a business to seize the promise of high-tech manufacturing of electronics, precision manufacturing, assembly and testing, and semiconductors in the medium term.”
The conglomerate has also recently acquired a stake in Tejas Networks, which is involved with manufacturing of telecom equipment. In addition to these, the Tata Group has already laid down its plans for a digital foray through a super-app and has acquired stakes in consumer internet firms like BigBasket, 1mg.com and CureFit.
Currently, the world is experiencing a shortage of chips and semiconductors that have become essential not only for new-age technological products like smartphones and computers, but also for traditional sectors like automobiles.
Several carmakers in the world have delayed deliveries of their vehicles and even pushed the launch of new vehicles because of the chip shortage. Tata Motors’ UK-based unit Jaguar-Land Rover has also done so.
For the Tata Group, while a foray into chip making would mean entering a lucrative business that can find customers not only in India but across the world, it would also be significant for captive use with Tata Motors, Tata Power, etc.
The chips, or semiconductors, which are the brain-centre of any electronic technology has found itself to become a rare commodity in the post-Covid era, with several large factories in places like South Korea and Taiwan being shut down. This has created pent-up demand that these foundries were unable to satisfy after opening up.
On the one hand, the pandemic caused a surge in demand for electronic devices such as smartphones, laptops and computers, etc.
The manufacturing and logistical bottlenecks meant that the situation was only exacerbated. This shortage that began last year, is expected to continue till 2022, and to prevent a future situation like this, a number of companies are planning to reduce their dependence on the only few large factories that supply to the whole world.
