Intel is the world’s largest manufacturer of semiconductors and central processing units.
Production restrictions in certain regions and the government’s Make-in-India initiative have helped make the country a top destination for the company. Stephen Langcorporate vice president and general manager Asia Pacific and Japan, Intel Corporation told ET.
“We see design and manufacturing opportunities for our partners here in India. Governance initiatives like Make-in-India are driving design opportunities from historical regions in Taiwan, or China or in other parts of Southeast Asia to India. We see a great opportunity here,” Long said.
Intel is also working with Indian telecom operators on 4G and 5G technology to offer design solutions such as Virtualized Radio Access Networks (V-RAN) and Open RAN (O-RAN), which were largely addressed by telecom solution providers such as Nokia and Ericsson.
“Intel makes money working with all three carriers in India and Asia. What excites me about Indian carriers is there’s some design work that they do that historically would have been done by a Nokia, or Ericsson, or even some Taiwanese suppliers… We’re actually helping these companies export and expand their capabilities ,” he added.
That’s what Intel said in February it would take over and merge Israeli chipmaker Tower to form a “fully integrated foundry company,” but the two companies would operate independently until the $5.4 billion deal closes, which is expected to close early next year.
The acquisition would also test the reach of the Taiwanese major TSMC which holds more than 53% of the global semiconductor market. Tower and Gulf-based Next Orbit Ventures are part of the ISMC analog consortium looking for capital incentives from the government to set up manufacturing units in the country.
According to a statement, Garg in his new role will be responsible for leading and strategically growing the Indian business for NXP Semiconductors across all four locations – Bangalore, Noida, Pune and Hyderabad.
“Historically, Intel has had factories, obviously semiconductor factories to manufacture products. Now more customers want their own design options that they want us to customize. In that sense, Tower becomes interesting to us because they have specialized nodes and older generation nodes that allow us to play in parts of the market where we haven’t in the past,” said Long.
The ISMC consortium has proposed to manufacture 65 nanometer (nm) chips, an older technology hub with applications ranging from consumer electronics to cars to energy devices segments, which have a thriving market in India.
Once completed, Intel’s year-old foundry division is expected to take over the new operations.
Last month, Randhir Thakur, president of Intel Foundry, said he would step down from his position at the end of January.
“The acquisition of Tower allows us to bring leadership as well as process and methodology. Between the acquisition of Tower and the departure of Randhir, I know that Pat Gelsinger, CEO of Intel, is actively looking for the right leader,” said Long.
The US’s share of chip design revenues has fallen in recent years from more than 50% in 2015 to 46% in 2021. Without government support, that could drop to 36% by the end of this decade, according to analysis by US industry association Semiconductor Industry Association (SIA) and Boston Consulting Group.