The Indian semiconductor design services industry is anticipated to grow at a CAGR of 21.7%, says a market research report.
The semiconductor design services industry of India is expected to grow at a CAGR of 21.7%, says, “Indian Semiconductor and Embedded Design Service Industry (2007-08)”, a report jointly prepared by India Semiconductor Association (ISA) and International Data Corporation (IDC), as reported by Business Standard.
The report highlighted that the Indian semiconductor device industry is projected to go from present US$ 6 Billion to US$ 10.96 Billion by 2010. Moreover, by the end of this year, it is expected to reach US$ 7.3 Billion.
Poornima Shenoy, President, ISA, said, “The Indian semiconductor design industry with over 200 companies is on a strong growth trajectory. Our growth is nearly 22% which is three times the global rate of around 7%. We are looking eastward for business and collaboration heralding a new ear in the future of the sector”, as reported by The Economic Times on April 23, 2008.
According to the industry experts, strong pool of highly qualified engineers, introduction of new designs and Intellectual Property (IP) development are some of the key forces that are making the Indian semiconductor design industry a preferential destination for embedded design services. Besides, the low-cost semiconductor products and emergence of third-party service companies that undertake designing projects are also boosting growth in the Indian semiconductor industry.
Furthermore, product and design service providing companies are also leveraging the localization of product manufacturing and designing. And the link between outsourcing companies and Original Equipment Manufacturers (OEMs) for consistent product design is giving a competitive edge to the Indian semiconductor market.
However, IDC also highlighted some issues which could pose challenge for the Indian semiconductor and embedded design service industry in the report. As per the report, the industry needs to take care of rising prices of semiconductor products because of the entrance of new players as they are adopting every business strategy to establish themselves in the market, thus giving tough competition to the existing players.
A Senior Research Analyst at RNCOS said, “The existing players need to lift the value chain to make intellectual property if they want to sustain the growth rate in the Indian semiconductor industry and to compete with new players.”
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