Learning from the CHIPS Act of the U.S.

  • August 9, 2023
  • Posted by: OptimizeIAS Team
  • Category: DPN Topics
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Learning from the CHIPS Act of the U.S.

Subject :Science and technology

Section: Awareness in IT

What is the CHIPS Act and its significance?

  • The CHIPS Act (Creating Helpful Incentives to Produce Semiconductors and Science Act) was enacted in 2022 in the U.S., allocating $52.7 billion over five years to boost American semiconductor competitiveness, innovation, and national security.

How does the CHIPS Act structure its implementation?

  • Funding Allocation: The Act splits funds into four areas:
    • CHIPS for America Fund (CFAF) ($50B) for manufacturing and research,
    • Department of Defense (DoD) ($2B) for unique defense technologies,
    • Department of State ($0.5B) for supply chain security, and
    • National Science Foundation (NSF) ($0.2B) for workforce growth.
  • Inter-Agency Collaboration: The Act emphasizes inter-agency coordination, reflecting the priority given to the semiconductor sector.

How does India’s semiconductor policy compare to the CHIPS Act?

  • Indian Approach: India’s policy is managed by the Ministry of Electronics and Information Technology (MeitY), divided among the India Semiconductor Mission (ISM) and the Center for Development of Advanced Computing (C-DAC), lacking the holistic structure of the CHIPS Act.
  • Suggested Synergy: India can enhance policy effectiveness by adopting the multi-departmental approach of the CHIPS Act.

How does the CHIPS Act emphasize workforce development?

  • Workforce Plans: Companies seeking funding under the Act must submit workforce development plans, highlighting the importance of skilled personnel.
  • National Semiconductor Technology Center (NSTC): The NSTC collaborates with industry and academia to build a skilled semiconductor engineering workforce.

What is India’s approach to building a semiconductor workforce?

  • Chips2 Startup (C2S) Programme:
    • MeitY’sChips2 Startup (C2S) program collaborates with universities and colleges.
      • Goal: Establish India as a semiconductor hub.
      • Applicants: Open to academia, R&D, startups, and MSMEs.
      • Focus: Train 85,000 engineers in VLSI and Embedded System Design.
      • Development Targets: Create 175 ASICs and 20 SoC prototypes in 5 years.
      • ESDM Growth: Contribute to Electronics System Design & Manufacturing sector.
      • Collaboration: Involves academia, R&D, industry, startups, and MSMEs.
      • Value Chain: Covers research, hardware design, system development, and R&D.
      • Participants: Includes IITs, NITs, IIITs, private colleges, and around 100 academic/R&D institutions.
      • Startup Involvement: Through collaborative projects, challenges, and proposals.
      • Tracks: Divided into Systems/SoCs/ASICs development, Application-Oriented Working Prototypes, and Proof of Concept Research.
      • Nodal Agency: C-DAC (Centre for Development of Advanced Computing).
    • C-DAC: Centre for Development of Advanced Computing, an entity under MeitY
    • Established: Founded in 1988.
    • Purpose: Engaged in research, development, and innovation in advanced computing and electronics.
    • Notable Projects: Developed India’s first supercomputer PARAM, and contributed to language technologies.
  • Inclusivity: To ensure an inclusive strategy, India should focus on certifying quality private training institutes alongside universities.

How is accountability structured in the CHIPS Act?

  • CHIPS Program Office (CPO): The CPO guides project viability criteria, ensuring alignment with strategic goals.
  • Investment Principals and Financial Structuring Directors: These roles catalyze private sector investment, diversifying funding sources.
  • Transparency and Reporting: Regular monthly progress reports enhance transparency and accountability.

What areas of research does the CHIPS Act prioritize?

  • Future Research Focus: The Act allocates $11B to future research, particularly advanced packaging for a competitive edge.
  • Forward-Looking Approach: The Act’s focus on advanced packaging emphasizes the importance of continuous technological innovation.

How does India’s semiconductor strategy compare in terms of research focus?

  • Advanced Manufacturing and Packaging: India could balance core manufacturing with investment in research on advanced techniques, aligning with the CHIPS Act’s approach.
  • Strategic Balance: India should prioritize immediate manufacturing capacity while investing in research for long-term technological leadership.

What are the lessons that India can learn from the CHIPS Act?

  1. Comprehensive Approach: India should adopt a holistic, multi-agency strategy akin to the CHIPS Act for consistent policy implementation.
  2. Research Prioritization: India should allocate resources for research in emerging semiconductor trends, as per the Act’s emphasis.

Transparency and Management: Regular reporting, transparency, and accountability are crucial for successful policy execution.

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Learning from the CHIPS Act of the U.S. Science and tech