Hitesh Garg, Vice President and Country Head, NXP Semiconductors.
Credit: Special Arrangement
Bengaluru: Dutch company NXP Semiconductors is looking to commit more of its resources to expand research and development (R&D) in India. The company had recently promised to put a significant amount out of its $1 billion investment kitty in Bengaluru. In a conversation with DH’s Sonal Choudhary - Hitesh Garg, Vice President and Country Head, NXP Semiconductors - spoke about the lack of incentives in the semicon-design ecosystem, DLI (design-linked incentive) scheme and more.
Despite having nearly 220 fabless firms and a fifth of the world’s design-talent pool, India’s semicon-design ecosystem gets only a fraction of the Rs 76,000 crore outlay for the industry - what reasons would you attribute this to?
I would not say that we are not supporting the design bit or manufacturing is receiving more of it. In India, money is not an issue, neither from the government or the ecosystem. Moreover, design also costs less, so from that angle, the triggers are lesser, manufacturing costs more, hence, the triggers are bigger for manufacturing,
The government usually needs a trigger, and so support from the government on the manufacturing end is a significant one and I don’t think they are going to stop here. Once this outlay is consumed, they will look for upgrading the fund possibly. I think we first need to see that it starts moving, and then I am sure there will be more support available.
What will be the focus of the $1 billion fund. How much of that will be deployed in Bengaluru?
While we cannot disclose the breakup - I can tell you that we have doubled our investments in the last 2 to 3 years in terms of R&D, and we will continue on the same path. Currently, NXP’s 35% R&D workforce is sitting in India, half of which is in Bengaluru and we intend to grow here more. I think the message of our company was that in the next 5 years, we are going to double down our R&D work in India.
What headwinds are being faced by the semicon design ecosystem?
I wouldn't say there are troubles or headwinds standing in the way of this growth design benefit. We are building semiconductors as a horizontal industry, because there is an opportunity. India has to be self-reliant for which the government is also trying and aiding more innovation.
What partnerships are you looking at right now after TCS, M&M and others?
We are a horizontal player, so we are working with a lot of customers, both in automotive and industrial which are also our main focus areas. I think in the near future there will be some announcements coming from our side.
Do you think the current incentives benefit more mature start-ups?
I see many companies getting funded by the government, so I think they have the right parameters in mind, and also India is a large country so you need to have a certain level of maturity before the government starts putting their money in. Meanwhile, there are also great programmes available and even great infrastructure in colleges, for the tooling side as well as talent development.
Most of the (intellectual property) IP created by India’s engineers are retained by foreign companies, limiting India’s influence in the semiconductor value chain. Your views?
In my personal view this does not hamper India’s influence because there are a lot of engineers who move from one company to another, so they carry that knowledge and it is not a big differentiator that one can’t do it. So I don't see that as a big gap or a big differentiator. IP is kind of oversold in my view.