Nikkei Electronics Asia -- February 2007
Tech Columns
Japanese Semiconductor Manufacturers Enter India

In this column last month, "India's IC Design Capability", I looked at integrated circuit (IC) design in India, and touched on some of the development facilities operated there by various European and US semiconductor manufacturers. This month I want to take a closer look at Japanese activity in India.
Japanese semiconductor manufacturers did not join European and US firms in entering India. Instead they adopted a more pragmatic, "wait-and-see" attitude. Finally, though, they are now beginning to take the plunge.
The primary reason for this is that it has become difficult to obtain the required design resources in Japan. "The popularity of the electronics industry overall is declining in Japan, and it is becoming harder to find talented people every year," said Manabu Ando, general manager, Server & PC Div, Elpida Memory Inc of Japan. For Elpida, which has enjoyed excellent performance in recent years, assuring design resources has become a matter of urgency.
Broadly speaking, Japanese semiconductor manufacturers are utilizing Indian design capabilities in two ways: by establishing their own design centers in India; and by tying up with Indian design services. The latter approach can involve dispatching engineers from Indian design services to work at Japanese semiconductor manufacturing firms, or the establishment of a design center in India by a design service for a specific client - called an offshore development center, or ODC.

Own Design Centers
Toshiba Corp of Japan is making the switch from a tie-up with a design service to establishing its own design centers. In December 2004, it acquired SoCrates Software Pvt Ltd of India, which was initially established by FTD Technology Pte Ltd of Singapore in August 2002 as an ODC. Currently, SoCrates primarily handles development of firmware for Toshiba system-on-chip (SoC) products.
Kawasaki Microelectronics Inc of Japan was the first to directly enter India, establishing an Indian branch in Bangalore in March 2006. The company plans to handle circuit design there, and to create an electronic design automation (EDA) environment.

Design Service Tie-Ups
Renesas Technology Corp of Japan, on the other hand, is actively utilizing existing Indian design services. In late October 2006, the company entered into a tie-up with KPIT Cummins Infosystems Ltd of India, a design service firm. According to Hideo Hara, general manager, System Solution Business Development Div, System Solutions Business Group at Renesas Technology, "We have been evaluating the capabilities of a number of Indian design service firms for the last few years, and it was about time to enter into a full-scale tie-up with one." As a result of the tie-up, KPIT Cummins Infosystems established an in-house ODC specifically for Renesas Technology, constructing an offshore development stance. Renesas Technology plans to develop SoC products at the ODC, and has established a similar subsidiary in Vietnam for the same purpose.
Another firm entering into a partnership with FTD Technology, like Toshiba, is Elpida Memory. In April 2006 FTD Technology established Edison Semiconductor Pvt Ltd of India in Bangalore specifically as an ODC for Elpida Memory. Edison will handle dynamic random access memory (DRAM) design.

Key Advantages
Whether they are directly hired or dispatched from design service firms, Indian designers have an excellent reputation for their technical expertise, even when young. Elpida Memory's Ando explained: "There are very few university graduates in Japan with any real experience in IC design. Many Indian universities, however, let students actually practice chip design, at least completely through the EDA tool platform. With just a little bit more training they are ready for actual product design."
The Japanese are also impressed by the high standard of English among Indian engineers. This ability is especially important when it comes to compliance with international standards for protocols, interfaces and the like - which are all written in English. Designing hardware and software often demands the ability to read and write specifications in English. In Japan, it is not uncommon for this aspect of the process to represent a large part of the work load.

by Ikutaro Kojima

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