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‘Will source chips from India if suppliers make’

NEW DELHI : US fabless chipmaker Qualcomm has asked its suppliers to diversify their manufacturing locations and will source semiconductor chips from India if its suppliers set up fabs in the country.

Cristiano Amon, Qualcomm’s president and chief executive officer, said on Tuesday that the San Diego, California-based company has been “very active” in telling its suppliers to diversify the supply chain for semiconductors to other countries. “If our suppliers are motivated to build in India and have the right incentives, we’re going to use their fabs,” Amon told reporters.

His comments come as the global manufacturing ecosystem struggles to emerge from a severe shortage of semiconductors that has hit the production of cars to computers.

Qualcomm makes chips for smartphones, automotive cockpits, RF radios and more, making the company a mainstay in the global 5G ecosystem. Although the company doesn’t own its own chip fabrication plants (also called fabs), it holds key intellectual property (IP) licences required for the development of 5G use cases. It partners with companies like the Taiwan Semiconductor Manufacturing Company Ltd (TSMC) to produce its Snapdragon-branded chips.

Unlike TSMC, however, fabs expected to be built in India won’t cater to cutting-edge technology nodes. Most phones today use chips that are built on 7nm and below nodes, whereas India is expected to build fabs in the 28nm and above nodes in the next five years or more. Amon said Qualcomm’s products, like RF radios, require higher process nodes as well, and hence the company also has use for such fabs. Technology nodes refer to specific manufacturing processes in the production of chips. Smaller nodes provide faster chips.

Qualcomm provided more than 31% of the processor chips running on smartphones in India in the calendar year 2021, according to Counterpoint Research. Its chips run on phones from Xiaomi, Samsung, Realme, Oppo, OnePlus and almost every other smartphone in India.

Meanwhile, Qualcomm expects more than half of its employees globally to be based in India in the near future, Amon said, as the company expands its research and development (R&D) activity in the country. Qualcomm has close to 18,000 employees in India, with 3,000 employees added in the last 12 months alone. Amon said engineers in India are doing advanced R&D work for the company’s global product portfolio.

“India plays an incredible role in what Qualcomm is. I think Qualcomm India has a very broad role and is a big part of our global development capability,” he said. “India has the ability to bring 5G to scale; of mobile devices, computers and fixed wireless access through broadband. It will benefit not only India but many other markets as well,” he said. “India will bring that scale to affordable price points, which will, in turn, benefit other regions like the Middle-East, Africa, Latam and South-East Asia,” he added. Further, Amon said India’s recently-concluded 5G auctions have been “incredibly successful” and praised the government’s decision to make use of spectrum for private 5G networks. “We’re extremely impressed and optimistic about what the Indian government is doing and its commitment to digital,” he said.

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