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Given the current geopolitical situation, the Government must reform its policies for electronics manufacturing, to enable India’s security and self-reliance says senior IT entrepreneur Ajai Chowdhry

ajai chowdhry “Modern wars “Modern wars are fought with are fought with se se iconductors” iconductors”

In 1996, ITA 1 agreement was signed by India to bring in a zero-duty regime for IT hardware products by 2005. This was signed without any discussions with the industry. It led to the decimation of the SMEs, and destroyed innovation as the country was not prepared for it. A country that created IT products ground up (HCL, Wipro, etc) slowly moved to cheap imports and trading instead of manufacturing.

In 1999, prime minister Atal Bihari Vajpayee set up the PM’s Task Force for hardware, of which I was a member. Under the leadership of Late Dr Seshagiri and Jaswant Singh, we created a policy to prepare the industry for 2005. Alas, it never saw the light of the day.

Come 2005, we wrote a paper on bringing the semiconductors (SIPS) and component-manufacturing ecosystem to India. This also floundered.

Further, in 2009, the government set up a task force chaired by me. This had deep representation of the industry, and we made pathbreaking recommendations – most of which were accepted by the government. We had predicted that the electronics import bill will gallop and exceed the oil import bill. The recommendations were: 1. Setting up of a National Electronics Mission on the basis of space (this was not implemented), 2. MSIPS-incentive scheme for manufacturing: This was implemented, but the internal approval process killed it, 3. Preferential market access for domestically manufactured products – was vigorously opposed by vested interests and never really got traction (now, we are talking about vocal for local), 4. Creating a semiconductor fab – still floundering, and 5. Electronic Development Fund to promote R&D in electronics – partially implemented.

In 2011, the PSA created a core advisory group for R&D in the Electronic Hardware Sector (CAREL). I co-chaired this, and we recommended that we should focus on ‘volume’ products and create a strategy to design these through a ‘design challenge’ and then provide these designs to various manufacturers to ‘Make in India’. The following products were suggested: smart meters, micro ATMs, tablets and converged mobile devices for education, tele-medicine, surveillance cameras, lowcost Indian smartphones, and set-top boxes.

There was progress on none of these, except for creating a local STB software. By now, we could have had Indian products. So, this was a case of missed opportunities, and the country lost precious time to make itself selfsufficient.

By such time, Chinese companies started dominating phone imports into the country. Then came the new electronics policy in which the phased manufacturing programme (PMP) was created specifically for mobile phones. This revived the industry and created a vibrant manufacturing ecosystem albeit with lowvalue addition. However, the domestic brands just could not survive, and today, the industry is dominated by the Chinese.

The geopolitical status has dramatically changed this year. China has been very aggressive, and entered Indian territory. China has been flexing its muscle in a large number of countries. China and Pakistan seem to be working together to destabilise India. Most people don’t know, but as per Maroof Raza (TOI, June 6, 2020), the Chinese agenda is to have access to an abundance of water to manufacture microchips.

In the meantime, the government has come up with a very attractive scheme to invite mobile manufacturing and the component ecosystem to India.

A Production Linked Incentive (PLI) scheme provides 4-6% incentive for those who can do volume manufacturing, and the concept is to get five global champions and five domestic champions. This is applicable from August 1. Twentytwo applications have been received as this has attracted investors globally. It would be good if we take a quick decision within the next three-four weeks to ensure that the interest is kept alive.

Also, the government has rightly turned policy to a new direction, towards Atmanirbhar Bharat in key identified industries, to create global scale. If we really want to utilise the key strengths of India, we must focus on ‘design in India’ as well as ‘manufacture in India’, as design creates IP and higher value addition in the country. Today, all major IT companies like HCL, TCS, Wipro, do a lot of designing for global customers. But with all this capability, we hardly design for India.

So, now we need to urgently move beyond mobile phone manufacturing in electronics. We need to look at high volume products like TVs and set-top boxes in consumer electronics, and also go after the $360-billion global market for desktops, laptops, servers and datacom products. The demand for such products has dramatically increased due to ‘work from home’ and online teaching.

We should look at providing a similar PLI scheme to attract investments. We have not really paid attention to reviving the MSMEs (the backbone of India) for creating the component ecosystem. They should also be covered under the PLI scheme. A major import item, PCBs, should also be covered under PLI.

We have not acted on IT products till now due to WTO, but given the current security threat posed by China, we can easily take such decisions to ensure a trusted value-chain for the digital security of the nation. How do we know anything about ‘backdoors’ and spyware sitting inside electronic hardware? These can result in serious cyber-attacks on major defence, power, space, homeland security, financial infrastructure, and can bring these down overnight. India has already made a start by barring Chinese apps. The time has come to take action on hardware which can be more dangerous than software. The US has taken strong action on this.

A range of med-tech products should also be identified for design and manufacture in India. But, SMEs should not be overlooked, as I can see happening in the draft policy. “Modern wars are fought with semiconductors” – Senator Ben Sasse, Senate Intelligence Committee, USA.

Should we or should we not create fabs in India? In

cover Story @businessgoamagazine Ajai Chowdhry: Flagbearer of India’s IT Vision

By sybil rodrigues

Ajai Chowdhry, began an exciting journey more than four decades ago with a dream of giving India its very own microcomputer. His sheer clarity of vision and hard work led to a revolution and laid down the foundation for the Indian IT industry, putting India on the map of the major economies of the world. He is one of the six founder members of HCL, India’s original IT garage startup founded in 1976, and today is a Rs 50000 crore (US $7.5 billion) global enterprise. Chowdhry has been a key force in driving in the growth of HCL.

He led the foundation of HCL’s overseas operations, starting with Singapore in 1980s and later expanded to the other South Asian Markets. Chowdhry, son of an IAS officer, was also a major force in driving the growth of HCL Infosystems, the flagship company of the group. He took over the reins of HCL Infosystems in early 90s and became the Chairman of the company in 1999. His leadership infused tremendous energy, into the company, thus taking HCL from a turnover of Rs. 400.6 crores (US $ 89 mn) in 1994 to Rs.11,542 crores (US $ 2.6 bn). Today, the company has emerged as India’s informationenabling powerhouse and was also awarded ‘Business Superbrands’ by The Brand trying to answer this question, we have lost 10 years or more. Now, the geopolitical situation has dramatically changed. It is no longer a question of “should we or should we not” but “what to do, how to do and when to do”. India, with its electronicsimport bill ballooning to $55 billion and facing a security threat if any of the chips used in the product are designed in China, needs to cover lost ground fast. (Are there backdoors somewhere?)

I strongly believe we should create a full ecosystem, with strong incentives, to go after this. This will entail: 1. Creating an R&D facility on the lines of IMEC, Belgium, 2. Quickly acquiring secondhand fab of 28 nm, which will take care of a large part of India’s current need, instead of going after the most modern fab; this will not cost more than $500–700 million. Alternatively, attract a Samsung-type company to move existing fab to India, 3. Setting up a fab, for speciality technologies – GAN, SIC, high-voltage devices, RF, AMS; this will have a good domestic market for inverters, chargers, EV, etc, and will not cost more than $500-700 mn, 4. Upgrading the strategic SCL fab to 90/65 nm, 5. Attracting at least two assembly-test-mark-pack (ATMP) facilities, and

Ajai Chowdhry receives Cybermedia Business ICT Award from Shri Narendra Modiji Council and rated the Most his consistent contribution Trusted Indian IT Brand by in building the IT industry in Economic Times in 2010-11. India.

Chowdhry has constantly Chowdhry was awarded been driving a vision of the DATAQUEST ‘IT Person “IT for the masses” and has of the Year 2007’ Award and been on several Government ‘Electronics Man of the Year’ committees working towards by ELCINA-EFY for 2010. He taking personal computers was also honoured with the and broadband connections CNBC Asia Business Award into every village in India. 2010 for the Viewer’s Choice It was this vision that made category. HCL Infosystems the first He was awarded the “India company in India to create Innovator of the Year Award” special products for the by then Finance Minister, rural market place like a Pranab Mukherjee at the 6th rural PC that works on a car edition of CNBC TV18 India battery or specially developed Business Leader Awards 2010. financial inclusion software Chowdhry was also honoured and hardware products. with the Cybermedia He is the Chairman of the Business ICT Award 2013 for Electronics Sector Skills Lifetime Achievement in ICT Council. Chowdhry is also by Narendra Modi in January currently the Co-Chairman 2014. of the Working Group for In August 2014, he has Development of Innovation been awarded Honoris Causa and IP in the ESDM sector. (D. Sc.) by the Indian Institute

In 2011, he was decorated of Information Technology, with the prestigious Padma Design & Manufacturing, Bhushan, one of the highest Jabalpur in recognition of civilian honours in the the significant contribution country, in recognition of he has made to the Indian IT industry and thought leadership in the field.

Gifted with a strong sense of entrepreneurship, Chowdhry has been enlisted among ‘India’s Most Powerful Brand Builders’ and has been adjudged among ‘India Inc’s Most Powerful CEOs’ by The Economic Times.

Presently, he is focusing on incubating entrepreneurship by aiding start-ups. He is also on the Board of Indian Angel Network and has invested in many startups. He continues to give back to the society through his in-depth experience and understanding of the industry. He lectures on entrepreneurship at IIT Hyderabad and IIT Patna. He was nominated by the President of India to be Chairman for IIT Hyderabad and then Chairman of IIT Patna. He has been appointed as the Chairman of International Institute of Information Technology (IIIT) Naya Raipur.

Chowdhry has also always focused on giving back to the society and this is not limited to his role in contributing to the Indian IT scenario but also several social initiatives which he is a part of. He has established a charitable trust called ‘Swayam’ which is committed to providing educational support to deserving children who, due to financial constraints, do not have the privilege of a firstrate and decent education

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6. Creating at least 100 fabless startups and giving PLI benefits to them.

Also, we must bring in an NRI champion to India, with deep experience in semiconductor technology. This is how Taiwan created its industry – by bringing Morris Chang.

Finally, if we take the right steps, we can be the next electronics hub for the world. It all depends on our aspiration Courtesy: Financial Express

Ajai Chowdhry contributes `42 lakhs to fight COVID-19 in Goa

By ameya nayak

Dr. Ajai Chowdhry, Founder, HCL and Padma Bhushan awardee has stepped forward and made a generous donation of `42 Lakhs to the Goa government to fight the COVID-19 pandemic. The funds that he has donated would be utilized to provide five high performance ventilators and five HFNO machines along with one decontaminating chamber for various hospitals. Chowdhry made the donation on behalf of his trust the Swayam Charitable Trust which has constantly been supporting the Government of National Capital Territory of Delhi (GNCTD).

Chowdhry and his family has been living in Goa and are residents of the state for atleast five months in a year. Commenting on the cause of fighting COVID. Dr Sawant also expressed his gratitude towards Chowdhry and said that his move would

Ajai Chowdhry receives Padma Bhushan from then President of India Smt Pratibha Patil development, Chowdhry decontaminating machine has said, “I feel like I am created by Chakr, an IIT giving back to the State. I Delhi incubated company.” have selected the best Indian Chief Minister Dr Pramod ventilator – the award winning Sawant, while offering his Noccarc V310 as I strongly comments on Chowdhry’s believe in encouraging contribution, said that he has Indian products. Also, I have set an example by contributing selected the world’s first N95 generously to the noble motivate other stalwarts who are in Goa to also make their contributions to the cause.

Chowdhry, while commenting on the outbreak of the pandemic said that this is one of the toughest challenges the world has ever faced, especially in India which happens to be a densely populated country. He proudly spoke of how the country is his top priority and appealed to everyone to act quickly and support each other as much as we can. While firmly reinstating that he will continue to support ongoing efforts to battle the virus, Chowdhry advised the State mechanism, private entities and philanthropic organizations to come together and act swiftly to ensure that the right medical equipment and resources are

made available in Goa