India-US enter semiconductor supply chain and innovation partnership

India and the United States on Friday signed a pact to establish a semiconductor supply chain and innovation partnership under the framework of India-US Commercial Dialogue that has been revived after a three-year hiatus.

The cooperation on semiconductors comes in the backdrop of the chip shortage that had badly disrupted the supply of automobiles and electronics in both countries, particularly after the outbreak of Covid-19.

“The United States would like to see India achieve its aspirations to play a larger role in the electronic supply chain. And the MoU (memorandum of understanding) that we signed is designed to help achieve that goal. We've already begun an action against the MoU, tasking both the Indian and American semiconductor industries to prepare an assessment of where they have gaps and lack of resilience in the supply chain and that will guide our work,” US Commerce Secretary Gina Raimondo told reporters in a joint briefing.

Raimondo, who was on a four-day visit to the national capital starting Tuesday, had earlier said that both sides had talked about collaborating with a common picture of supply and demand in the semiconductor industry and figure out where there might be opportunities for joint ventures or technology partnerships, job training, research and development partnerships.

Co-chaired by commerce and industry minister Piyush Goyal and American counterpart Raimondo, the commercial dialogue is a part of ongoing efforts to strengthen US-India Comprehensive Global Strategic Partnership.

The commercial dialogue was primarily focused on resilient and secure supply chain, facilitating climate and clean technology cooperation, inclusive digital growth, talent development, including skilling, the post-pandemic economic recovery, especially for MSMEs, startups and focus on cooperation on quality standards.

Raimondo led a high-level business delegation of American CEOs for the India-US CEO Forum that aims to focus on shared strategic priorities on both sides.

Goyal said both countries also launched the Standards and Conformance Cooperation Program that will be carried out in partnership between US’s American National Standard Institute (ANSI) and India’s Bureau of Indian Standards (BIS) towards standards cooperation. “India has recognised that we have to be quality suppliers and consumers in goods and services. We offer a large marketplace, and we can capitalise on economies of scale to meet India’s and the world’s needs. We need to align in terms of international standards,” Goyal said.

The US is India’s largest exporter and trade partner, while India is the ninth largest trading partner for the US. Bilateral merchandise trade during April-January stood at $108.43 billion. Both nations aim to achieve bilateral trade of $500 billion by 2025.

The US is also the third biggest source of FDI for India, and is one of the top five investment destinations for India.

Key Outcomes of Commercial Dialogue:

– New working group on Talent, Innovation and Inclusive Growth to further the cooperation on start-ups, SMEs, skill development and entrepreneurship. The working group will also support the efforts under Critical and Emerging Technology (iCET)

– Re-launched Travel and Tourism Working Group to address new challenges and opportunities to create a stronger travel,tourism sector

– Launched Standards and Conformance Cooperation Program–a partnership between US’s ANSI and India’s BIS towards standards cooperation

– US side to send a senior government official-led Clean Energy and Environmental Technology Business Development Mission to India in 2024

– Both sides to work together in the Global Biofuels Alliance and in the development and deployment of hydrogen technologies

- US-India Energy Industry Network (EIN) will be as a broad platform for facilitating US industry involvement in the Clean EDGE Asia initiative to grow sustainable and secure clean energy markets throughout the Indo-Pacific region.