India Needs Homegrown Product Companies In Semiconductor: Cadence Design's India MD Most multinationals retain product ownership, key value and intellectual property at their headquarters. As a result, India, despite having a vast pool of design talent, lacks significant Indian product companies in the semiconductor industry, says Jaswinder Ahuja, MD, India Cadence Design Systems.

Cadence Design Systems, one of the leaders in electronic systems design and automation, predicts significant opportunities for Indian companies that own and develop their semiconductor products. "What we are missing in India is the presence of homegrown product companies. Most multinationals retain product ownership, key value, and intellectual property at their headquarters. As a result, India, despite having a vast pool of design talent, lacks significant Indian product companies in the semiconductor industry. This is an area where we hope to see substantial change in the coming years, with the development of more Indian companies that own and develop their semiconductor products," said Jaswinder Ahuja, MD, India and corporate vice-president, international headquarters, Cadence Design Systems.

A combination of specific policies by the Indian government, such as the Design Linked Incentive (DLI) plan, along with the domino effect of the entire ecosystem bootstrapping in India, is set to transform the landscape. However, if a fabrication plant (fab) or an outsourced semiconductor assembly and test (OSAT) facility is established in isolation, it would still rely on global customers to fill its capacity, due to the lack of Indian product companies utilizing these facilities. This highlights the need for a comprehensive approach that encourages the growth of indigenous product companies to fully capitalize on the semiconductor ecosystem being developed in India.

"What we want is for all pieces of the semiconductor value chain to be present in India, given the size and scope of the Indian economy. India has the capacity to support every aspect of this value chain. Of course, this ecosystem will not operate in isolation from the global semiconductor value chain. Instead, it must function as an integral part of the worldwide network, collaborating and interacting seamlessly with the rest of the global semiconductor industry," he explained.

While the world is advancing to 2 and 5 nanometer technology nodes, with production already happening at 5 nanometers and designs being developed for 3 and 2 nanometers, India is taking its first steps with the 28-nanometer node. This highlights that India will not encompass the entire spectrum of semiconductor technologies. "We can certainly develop parts of the front-to-back value chain in India, but achieving the full breadth and depth of this value chain is an unrealistic goal for any single country at this time. It is crucial to recognize that while India can build significant capabilities, it will still rely on the global semiconductor ecosystem for certain advanced technologies," Ahuja added.

DLI scheme and industry collaboration

Over the past 25 years, Cadence Design has nurtured talent in India. Currently, more than 400 engineering colleges nationwide have access to Cadence software, enabling students to utilize it freely for academic and research purposes. "Our engagements extend beyond mere software provision; we actively collaborate with universities on faculty development initiatives and organize student design contests to cultivate enthusiasm and proficiency in using commercial tools for design projects."

Under the India semiconductor mission and government semiconductor policy, two significant initiatives are underway. The first is the Chips to Startups (C2S) initiative, a collaboration with the Indian government aimed at supporting select universities through access to software and comprehensive support. This program facilitates academic and research activities essential for semiconductor design. Additionally, it aligns with the Chip-in initiative overseen by CDAC, enabling universities to engage in both research and development for chip design while fostering startup creation in this critical sector. These initiatives are advancing India's capabilities in semiconductor technology and nurturing a thriving ecosystem for innovation and entrepreneurship in the field.

Another significant initiative by the government of India, distinct from talent development but crucial for promoting product development, is the DLI. According to the Ministry of Electronics & Information technology, DLI Scheme shall extend product design linked incentive of up to 50 per cent of eligible expenditure and product deployment linked incentive of 6 per cent - 4 per cent on net sales for five years. Support will be provided to 100 domestic companies of semiconductor design for Integrated Circuits (ICs), Chipsets, System on Chips (SoCs), Systems & IP Cores and semiconductor linked design and facilitating the growth of not less than 20 such companies which can achieve turnover of more than INR.1500 crore in the coming five years.

Under this initiative, Cadence's software plays a pivotal role as it is accessible through the national EDA grid to all startups selected for the DLI program. This integration supports startups across India in leveraging advanced electronic design automation tools to enhance their product development capabilities.

Innovation with AI

Artificial Intelligence (AI) workloads require different types of compute fabrics. While NVIDIA is dominant in the data center segment, there are many other places where AI workloads need to be processed. "We typically talk about AI at the edge where we need semiconductor devices that can process AI workloads for inference or for decision making, but at much lower latencies and at much lower power consumption. The design complexity has been doubling almost every two years or less. For the overall cost of design to remain manageable, companies cannot double their design teams and have twice the amount of time to do semiconductor design. The time to get a product to market windows has been shrinking with time. In this context, Cadence Design's key value propositions to customers is to help improve design productivity," Ahuja explained.

At present the company is trying to incorporate AI-based techniques in all of its software.There's a lot of AI research that's happening inside Cadence to make tools and technology AI-enabled or AI aware or leverage AI so it can deliver that next generation of productivity improvement to customers in complex designs.

Besides, a lot of chips are moving to a new packaging technology called 3D-IC which comes up with its own unique set of challenges. "We are the only company which has a comprehensive solution to solve these kinds of problems, to be able to do 3D-IC design, to package and to do full analysis for thermal, electromagnetic, and other such effects that are key to long-term effective functioning of these 3D-IC chips. This extends beyond electrical analysis and electronic design and goes into the realm of mechanical," he said, explaining the next-gen innovation.

Expansion plans In India

Cadence presently has over 4,000 employees in five locations, which represents over one-third of the company's headcount. "We already have a very sizable presence in India and we will keep growing in line with our business needs. We don't have specific numbers targets, but our track record of growth in India speaks for itself and we will continue to grow in India as business works."

The company inaugurated a new building with a capacity of 600 people in Noida a year and a half back. "We are currently looking at expanding our facilities in Hyderabad, Bangalore and Pune and we should be in a position to make some announcements later in the year," he added.