US backing India in semiconductor sector a lip service: China

New Delhi: China called the United States, providing India help to advance the latter's semiconductor manufacturing capacity lip service. The Chinese state-run media Global Times (GB) said so when the US and India agreed to join hands on semiconductors, IANS reported.

US deputy assistant secretary, Afreen Akhter, had said that the US would extend hands to India over semiconductor manufacturing during her semiconductor trade mission. She had met top Indian officials in New Delhi.

The GB said the US proclamation was designed to "lure India into a geopolitical game to exclude China from the global chip industrial chain, rather than a commitment with real investment plans to support India's chip manufacturing."

The CHIPS and Science Act of the US will serve $52 billion in subsidies for chip manufacturers to build fabrication plants in the US, an attempt to build up an industrial chain focused on the interests of the US. GB wrote that the deal "is unlikely to bring benefits to India."

India has introduced a series of preferential policies to attract chip companies to invest in production in the country. Last year, the government announced a Rs 76,000 crore performance-linked incentive (PLI) scheme in the semiconductor sector to boost local manufacturing.

When India and the US strengthened domestic semiconductor manufacturing, China saw the biggest monthly fall in chip manufacturing, thanks to Covid-19 restrictions in August, which added to falling demand.

This was after July's fall of 16.6 per cent to 27.2 billion units.

Now, the Gujarat government joined hands with Vedanta and Foxconn. The administration aims for an investment of Rs 1.54 lakh crore, targeting self-reliance in the semiconductor sector.

GB further report that India wishes to -become a chip powerhouse and it "should not take the bait laid by American diplomats in the hope that the US will provide it with important resources," IANS quotes.

"First, the assistance that Akhter said the US would provide to India may not be delivered on," the report added.

It said, "Even as the US chose India as a partner in semiconductor cooperation in geopolitical calculations, this doesn't mean it will really help India to boost the semiconductor sector."

GB said India "must build up a solid industry basis instead of pinning its hope on US lip service".