Readying for global microchip market

Tasked with preparing a roadmap so Bangladesh may explore its potential as a player in the world's booming semiconductor market, the National Semiconductor Taskforce (NST), which was formed in early January this year, has come up with a set of recommendations. The recommendations focus on identifying the segments in the global microchip industry's value chain that offer the best opportunities for Bangladesh to exploit and chart out a course of action, for instance, assessing the need gap, adopting a policy, building capacity and so on. Led by the Bangladesh Investment Development Authority (BIDA), the 13-member NST has been drawn from a cross section of people including representatives from the government, the private sector, the academia and the Non-Resident Bangladeshi (NRB) community. Admittedly, the roadmap the NST submitted to the interim government's Chief Adviser (CA), Dr Muhammad Yunus, covers the critical areas that would require the government's support, especially in terms of its fiscal incentives and other policy-related backups. The plan to train thousands of IT engineers to power the growth of the domestic semiconductor industry is, of course, the first step. However, the training should involve hands-on experience, not just theoretical knowledge that Bangladesh's tech graduates usually learn from the technical institutes. That would necessitate the science and engineering graduates to have industry exposures through internship or other forms of work experience so they might be hired by the domestic tech companies or those in the global market. Alongside preparing the youths for jobs in the local and overseas tech markets, the government, as it spelt out in the NST's recommendations, would also be required to streamline its customs procedures and create dedicated zones in the high-tech parks to attract investors and encourage startups. These are some of the basic steps to develop country's semiconductor industry and turn Bangladesh into a player in global microchip market. There is no gainsaying the importance of these steps which have been described in the roadmap. These issues are also being talked about at various discussion forums since long. So after all the talks, it is now time to put those  into concrete actions and ensure Bangladesh's entry into the multibillion dollar semiconductor market. According to an estimate, globally, total sales of the semiconductor sector reached USD627 billion in   2024 and is expected to rise to USD 697 billion by the end of 2025. Though the semiconductor industry is more than 75 years old, the digital revolution, also called the Third Industrial Revolution, that started with the invention of the Integrated Circuit (IC) or microchip in 1958, actually fuelled the growth of the semiconductor, or to be more to the point, the microchip industry. As no digital device can now be conceived of without microchips to run it, the industry has been expanding at breakneck speed so much so that the sector is forecast to grow into a trillion dollar one by 2030. Obviously, microchip sector is a highly competitive one. And that is more so because it has also become a theatre of competition between global tech powers, especially the USA and China. And the race is about taking the lead in the advancement of the AI industry. It is worth noting that AI's efficiency depends on development of the most advanced microchips, an area traditionally dominated by the US, the Netherlands, Taiwan and South Korea. China, too, has recently emerged as a big player in developing advanced microchips. To be frank, the domain of semiconductor has, of late, turned into a veritable hotspot of geopolitical rivalry.

Since Bangladesh lacks the required physical infrastructure and trained manpower to start in a big way, the natural course of action it can take is to target areas in the semiconductor industry that are neither capital intensive, nor in need of high levels of skill. At present, Bangladesh's fledgling semiconductor industry caters mainly for designing service for the international microchip sector. Other areas including fabrication or making the chips, their assembly and testing require more advanced skills. But all the prospects are contingent upon uninterrupted supply of power and other utilities. So, before everything else, the government needs to get back to the basics.

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