India and Japan signed a pact to build up the semiconductor industry

Japan has signed a deal with India to jointly expand the semiconductor ecosystem and maintain the robustness of its global supply chain, becoming the second Quad partner after the United States to do so. In the nation's capital, the deal was signed by Japan's Minister of Economy, Trade, and Industry Yasutoshi Nishimura and Union Minister for Electronics and IT Ashwini Vaishnaw.

"Japan and India have signed a memorandum for semiconductor design, manufacturing, equipment research, talent development, and to bring resilience to the semiconductor supply chain," said Vaishnaw. According to Vaishnaw, the countries would establish a "implementation organisation" to work on government-to-government and industry-to-industry cooperation.

"Everyone wants a robust semiconductor supply chain, and India and Japan are key players in this. This is a continuation of our Prime Minister Shri Narendra Modi Ji's highly productive state visit to the US, where many agreements were struck, and it reflects in current international collaboration, according to Vaishnaw. Japan is one of the top five nations with a semiconductor ecosystem, with about 100 semiconductor production facilities.

The semiconductor industry will grow from its current size of USD 650 billion to USD 1 trillion. This will call for a tremendous quantity of talent and major global expansion. According to Vaishnaw, Japan views India as a partner with complementary strengths. Japan is home to businesses that are world leaders in industries such as semiconductor wafers in their raw form, chemicals and gases, lenses for chip fabrication equipment, display technology, etc.

Vaishnaw declared, "It will be a significant milestone if we can bring this base to India. According to the minister, negotiations for cooperation in the sector have already begun between the government and Japan's state-backed semiconductor industry agency, Rapidus. The minister said that the decision has very little influence because there are many additional sources of these crucial materials throughout the world when asked about the effect of China prohibiting export of the important semiconductor elements gallium and germanium.