This is how the intensification of India and the United States of domestic manufacture of semiconductors is hurting China

With India and the US doubling their domestic semiconductor manufacturing process, China saw its biggest-ever monthly drop in chip manufacturing in August due to Covid restrictions and weak demand.

According to the South China Morning Post, production of integrated circuits (ICs) fell 24.7% year-on-year to 24.7 billion units, marking the largest one-month decline since 1997, and this is also the second consecutive month of decline for chip manufacturing. In July, production fell 16.6% to 27.2 billion units.

Domestic production of microcomputers fell 18.6% to 317.5 billion units in August, and the report stated that domestic manufacturing activity contracted in August for the first time in three months, and according to statistics from the Qichacha business database platform, 3,470 chip makers “stopped working in the first eight months of the year.

The decline in chip production in China comes as both India and the US step up their efforts to boost domestic chip manufacturing, and the government of India’s Gujarat state has partnered with Vedanta and Foxconn with the aim of investing Rs 1.54 crore to achieve self-reliance in semiconductor manufacturing.

India’s semiconductor components market is likely to reach $300 billion in cumulative revenue by 2026, as ‘Make in India’ plans and Production Linked Incentives (PLI) will boost domestic sourcing of semiconductors in the coming years, according to the report from the Indian Electronics Association. and Semiconductors (IESA) and Counterpoint Research.

The Indian government has announced spending about $10 billion, under its PLI scheme, separately to develop an electronics system for manufacturing semiconductors and displays, meanwhile, US President Joe Biden has signed into law the Chips and Science Act, which saves nearly $52 billion. incentives for semiconductor production.

Intel began work on a new $20 billion semiconductor plant in Ohio, and Samsung floated the idea of ​​investing nearly $200 billion to build 11 additional chip plants in the United States over the next two decades.

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