JULYASIA BUSINESS OUTLOOK9NEWSROOMINDIA'S ELECTRONIC MANUFACTURING TO HIT $500B VALUATION BY 2030ByteDance, the Chinese company behind TikTok, is collaborating with Broadcom, a US chip designer, to develop a cutting-edge artificial intelligence processor. This partnership aims to ensure ByteDance has reliable access to high-performance chips amidst ongoing tensions between the US and China. The 5-nanometer chip in development is a customized ASIC (application-specific integrated circuit) designed to comply with US export regulations. According to sources familiar with the matter, the chip will be manufactured by Taiwan Semiconductor Manufacturing Company (TSMC).Since the introduction of export controls by Washington in 2022 for state-of-the-art semiconductors, there have been no publicly disclosed collaborations between Chinese and US companies focusing on chip development using 5nm or more advanced technology. Generally, agreements between the US and China in this sector involve significantly less advanced technologies.The sources, who declined to be identified due to the sensitivity of semiconductor issues in China, said ByteDance's tie-up with Broadcom, an existing business partner, would help slash procurement costs and ensure a stable supply of higher-end chips. However, TSMC is not expected to start manufacturing the new chip this year, they said. One of them said that while design work is well underway, the "tapeout" which marks the end of the design phase and the beginning of manufacturing has not started. India needs to take critical actions to transform its electronics sector from an "import-dependent, assembly-led manufacturing" model to "component-level, value-added manufacturing," according to a report by the Confederation of Indian Industry (CII).In 2023, the demand for components and sub-assemblies reached $ 45.5 billion, supporting $ 102 billion worth of electronics production. This demand is projected to rise to $ 240 billion to support $ 500 billion worth of electronics production by 2030. Priority components and sub-assemblies, including Printed Circuit Board Assemblies (PCBAs), are expected to grow at a robust CAGR of 30percent, reaching $ 139 billion by 2030.The report recommends that the government take several key actions, such as introducing a scheme to provide fiscal support, launching SPECS 2.0 (Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors), rationalizing import tariffs on components like camera modules, and signing Free Trade Agreements (FTAs) with European and African countries.Five priority components and sub-assemblies--batteries (lithium-ion), camera modules, mechanical parts, displays, and PCBs--are identified as high priority for India. These components accounted for 43percent of the demand in 2022 and are expected to grow to $ 51.6 billion by 2030.Currently, these components have either minimal production in India or are heavily import-dependent. Sustaining this trend of importing key components is not feasible for India. The PCBA segment, in particular, is highlighted as having high potential for domestic production, with demand expected to grow by 30 percent, leading to a demand of around $ 87.46 billion by 2030. BYTEDANCE & BROADCOM TO JOINTLY DEVELOP AI PROCESSORSJULYASIA BUSINESS OUTLOOK9
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