New Delhi: Tata Electronics on Tuesday signed a memorandum of understanding (MoU) with California-headquartered semiconductor design and engineering firm Synopsys, to collaborate on various technological verticals. The partnership will see Synopsys’ offerings being used in Tata Electronics’ upcoming $10.9-billion semiconductor fabrication plant, or fab, in Dholera, Gujarat, which was announced on 29 February.

As part of the MoU, Tata Electronics will use Synopsys’ foundry design platform, which will help ramp up designing custom semiconductor products for clients—once the fab is complete. Other areas of technology that the two companies will collaborate on include factory automation, data analytics, computer-aided design and technology transfer from Synopsys to Tata Electronics, supply of product design kits by Synopsys, and development of intellectual properties for the chip fab, once it is ready.

Randhir Thakur, chief executive and managing director of the Bengaluru-registered Tata Electronics, said in a statement that the move will help the company offer “​​integrated solutions across the electronics manufacturing value chain to global customers seeking a resilient supply chain.”

Tata’s Dholera fab was approved by the Union Cabinet on 29 February, under the government’s Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India, with Taiwan’s Powerchip Semiconductor Manufacturing Co (PSMC) as its primary technology partner. At the time, Union IT minister Ashwini Vaishnaw said that the plant would produce 3 billion chips annually, once up and running at full capacity, and will make chips ranging across 28nm (nanometre), 50nm, 55nm and 90nm nodes.

A semiconductor ‘node’ denotes the size of a chip. Roughly, chips used in advanced electronics such as smartphones and laptops use the smallest nodes, such as the 3nm chips powering Apple’s iPhones and Google’s Pixel phones. Such chips are largely controlled globally by Taiwan Semiconductor Manufacturing Co (TSMC), which controls over 50% of the world’s chip supply.

Semiconductor Milestone

The Tata Electronics-PSMC plant in Dholera, meanwhile, will make chips that will cater to smart appliances, railways, automobiles, defence applications and more. Senior industry executives said at the time that the move represented a starting point to manufacture semiconductor chips in India—going beyond assembly, testing, marking and packaging (ATMP) chip facilities.

Tuesday’s partnership could further contribute to India’s semiconductor supply chain, and add credibility. A senior industry official close to India’s chip approval plans at the Centre told Mint on condition of anonymity, “Synopsys is an active semiconductor supply chain participant, with active global clients. Such a partnership can add an influential layer to attracting clients to the Dholera chip fab. This would be a crucial early test for the fab, once ready—failing to draw major clients across key industries could hurt India’s reputation.”

However, questions remain around whether Tata Electronics would be able to get the plant up and running by the end of 2026—which the Centre had projected upon approval. “Chip fabs are complicated. Even if there are likely delays from the initial projection, this should not come as a major surprise to those who have worked in the chip industry,” the executive cited above further said.

The Nasdaq-listed Synopsys is a recognized name in the global semiconductor ecosystem. In the March quarter, Synopsys reported a revenue of $1.46 billion on the back of a burgeoning semiconductor ecosystem—being driven globally by an increasing demand for chips across every industry.

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Published: 25 Jun 2024, 08:03 PM IST

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