New Partnership of US and India to explore Semiconductor Supply Chain opportunities

The US Department of State will partner with the India Semiconductor Mission, Ministry of Electronics and IT, Government of India to explore opportunities to grow and diversify the global semiconductor ecosystem under the International Technology Security and Innovation (ITSI) Fund, created by the CHIPS Act of 2022 (CHIPS Act), a statement by the US Department of State said.

This partnership will help create a more resilient, secure, and sustainable global semiconductor value chain, the statement said.

In a post on X, the US-India Strategic Partnership Forum posted a video where Kurt Campbell, US Deputy Secretary of State was seen speaking. Campbell said that expanding US-India partnership is one of the most strategically important efforts they took in the Biden-Harris administration.

“Expanding our partnership with India is one of the most strategically important efforts we have taken in the Biden-Harris administration… As we said during Prime Minister Modi’s official state visit last year, from the stars to the sea, no corner of human enterprise is untouched by the cutting edge work we are doing together. Successive administrations in Washington and New Delhi have invested time and political capital to bring this partnership to greater and greater heights,” he said.

Campbell, addressing the forum through video conference, said that today, India and the US are more aligned than ever before.

“Today, our two countries are more closely aligned than ever before. In just over a year since we launched INDUS-X, we have pursued an ambitious agenda of summits, joint challenges and exchanges. I expect these efforts will continue given the deep bonds that tie our countries together and the strategic challenges we both face,” Campbell said.

He said that INDUS-X will be a cornerstone of the ICET.

“INDUS-X is now and will be a cornerstone of our continuing efforts to advance the US-India Initiative on Critical and Emerging Technology (ICET). ICET technological leadership is increasingly at the heart of strategic competition. It is the great differentiator in our foreign policy approach and India is in a very small group of countries with whom we work most intimately on tech. ICET, which places technology at the very heart of the US India partnership, has greatly accelerated our strategic cooperation. The second ICET meeting between our national security advisors in June showed the immense progress we are making across a range of sectors, including space semiconductors, advanced telecommunications, artificial intelligence, quantum biotechnology and clean energy. Deepening defence innovation cooperation is also a key pillar of ICET,” he said.

Talking about defence, Campbell said that India and the US’ joint effort will help them maintain a critical advantage for the armed forces.

“Our work together driving innovation and developing cutting edge technologies will help us maintain a critical advantage for our armed forces. We’ve taken unprecedented steps to increase operational coordination, information sharing and defence industrial cooperation, including co-production. In fact, we’ve authorized an unprecedented level of technology transfer as part of the GE engine co-production arrangement. And our two governments have just finalised a security of supply arrangement to reinforce our supply chain resilience,” he said.

Campbell said that under the INDUS-X, US and India announced USD 1.2 million worth funding.

“Under INDUS-X, the US and Indian governments have also announced awards of 1.2 million in seed funding to ten US and Indian companies under joint Impact 1.0 challenges. Our intent to launch two additional joint challenges, other domains, including space and the launch of an INDUS-X testing consortium of industry, academia and non-profit organizations across the United States and India to promote our company’s access to testing and experimentation facilities,” he said.

He added that the US invested significantly to pursue partnership with India.

“The United States has invested significantly in expanding our strategic partnership with India and we are pursuing a robust agenda to deepen cooperation for the rest of the year, not only diplomatically, but also through ICET. Our defence establishments, research institutions, private industry and start-ups possess a deep bench of talent and mutual thirst for innovation, which is why INDUS-X has designed to create the necessary ecosystem and partnerships for new ideas, research and development to flourish. By participating in INDUS-X, you are all at the forefront of our efforts to apply cutting edge commercial technologies for military solutions. And because US-India co production and cooperation on critical technology will define Indo Pacific security for generations to come, the work you are doing could not be more important,” he said.

The initial phase includes a comprehensive assessment of India’s existing semiconductor ecosystem and regulatory framework, as well as workforce and infrastructure needs. State anticipates that key Indian stakeholders, such as state governments, educational institutions, research centers, and private companies, will participate in this analysis steered by the India Semiconductor Mission. The insights gained from the assessment will serve as the basis for potential future joint initiatives to strengthen and grow this critical sector.

The United States and India are key partners in ensuring the global semiconductor supply chain keeps pace with the global digital transformation currently underway. Manufacturing of essential products ranging from vehicles to medical devices relies on the strength and resilience of the semiconductor supply chain. This collaboration between the United States and India underscores the potential to expand India’s semiconductor industry to the benefit of both nations.

In August 2022, US President Joe Biden signed the CHIPS Act, a US law that appropriated new funding to boost domestic manufacturing and research of semiconductors in the United States. The CHIPS Act also created the ITSI Fund, which provides the US Department of State with USD 500 million (USD 100 million per year over five years, starting in Fiscal Year 2023), to promote the development and adoption of secure and trusted telecommunications technologies, secure semiconductor supply chains, and other programs and initiatives with our allies and partners.