The journey of development in India from Charkha (spinning wheel) to Chip (semiconductor) is a fascinating tale that spans centuries and encapsulates the nation’s evolution from traditional craftsmanship to cutting-edge technology. This journey can be divided into several key phases, each marked by significant advancements and transformations:
Pre-Independence Era (Charkha)
Charkha is a traditional tool for spinning cotton or other fibres into yarn. Following Mahatma Gandhi’s return in 1915 from South Africa during his activism in the national independence movement, the Charkha symbolised India’s struggle for independence under his leadership. Gandhi popularised the spinning wheel to promote self-reliance and economic independence. The Charkha became a powerful symbol of resistance against British colonial rule and a tool for empowering rural communities.
The Charkha played a central role in Gandhi’s Non-Cooperation Movement in the early 1920s. As part of the movement, Indians were encouraged to boycott British goods and institutions and instead support indigenous industries, including hand spinning and weaving. The Non-Cooperation Movement and the Charkha campaign garnered widespread support across India, mobilising millions of people in a peaceful protest against British rule.
Gandhi became a symbol of the Charkha, often photographed spinning yarn while promoting the message of Swadeshi and self-reliance. Even after independence, the Charkha continues to be celebrated as a national symbol, appearing on India’s currency, Government emblems, and various cultural artefacts.
Post-Independence Industrialisation
Following independence in 1947, India embarked on a path of industrialisation and economic development. The focus was building primary industries such as steel, coal, and heavy machinery to support the nation’s growth. Significant efforts towards post-independence industrialisation marked the 1950s and 1970s in India. After gaining independence from British rule in 1947, India’s leaders recognised the need to build a self-reliant economy. The focus shifted towards industrial development to achieve economic growth, alleviate poverty, and promote social justice. However, the economy remained largely rural, with limited technological innovation. This period saw the implementation of various policies and strategies aimed at fostering industrialisation:
Starting in 1951, the Indian Government adopted a series of Five-Year Plans modelled after the Soviet Union’s economic planning approach. These plans set targets for industrial growth, agricultural development, and social welfare.
The plans emphasised the establishment of primary industries such as steel, coal, cement, and heavy machinery, which were considered crucial for the country’s industrial foundation.
Public sector enterprises played a central role in implementing the Five-Year Plans, with the Government taking the lead in setting up key industries and infrastructure projects.
Import Substitution Industrialisation (ISI) became the dominant strategy during this period. It involved promoting domestic industries by substituting imports with domestically produced goods. Industries such as textiles, automobiles, steel, and consumer goods were given priority under the ISI policy to reduce imports and achieve import substitution.
The Government played a leading role in industrial development by establishing Public Sector Enterprises (PSEs). These enterprises were set up in strategic sectors such as steel, coal, oil, telecommunications, and infrastructure. The public sector was seen as a means to promote state-led development, generate employment, and ensure equitable resource distribution.
Public sector companies like Steel Authority of India Limited (SAIL), Bharat Heavy Electricals Limited (BHEL), and Hindustan Aeronautics Limited (HAL) were established to spearhead industrialisation and infrastructure development.
In addition to industrialisation, the period witnessed significant strides in agricultural development, particularly with the introduction of the Green Revolution in the 1960s.
The Green Revolution, facilitated by the use of high-yielding crop varieties, chemical fertilisers, and modern agricultural practices, dramatically increased agricultural productivity and output.
Improved agricultural productivity boosted food grain production and generated surplus labour for the industrial sector, contributing to urbanisation and industrial growth.
Despite the efforts towards industrialisation, the period faced numerous challenges and criticisms as the strategies adopted led to inefficient and protected industries that could not compete globally.
Bureaucratic red tape, inefficiency, and corruption in the public sector hindered industrial growth and innovation. The lack of competition and incentives for efficiency often resulted in poor performance and low productivity. The emphasis on heavy industries and neglect of small-scale and rural industries led to regional disparities and uneven development, exacerbating income inequalities.
The period between the 1950s and 1970s laid the foundation for India’s industrialisation and infrastructure development. Many public sector enterprises established during this time played significant roles in the Indian economy. However, the experience of this period also highlighted the limitations of a state-led, inward-looking approach to industrialisation. Subsequent economic reforms since the 1990s have sought to address these shortcomings by liberalising the economy, promoting private sector participation, and integrating India into the global economy.
Liberalisation and Technological Revolution
Before liberalisation, India followed a policy of central planning and state intervention in the economy, characterised by a complex system of licenses, permits, and regulations. While this model aimed to promote self-sufficiency and reduce inequality, it resulted in inefficiencies, bureaucratic red tape, and slow economic growth. By the late 1980s, India faced a severe balance of payments crisis, with dwindling foreign exchange reserves and high inflation.
In the early 1990s, India initiated economic liberalisation, opening its markets to foreign investment and trade. This period marked a significant shift towards a market-oriented economy and paved the way for rapid technological advancement.
The IT (Information Technology) revolution was pivotal in India’s development. The country emerged as a global hub for software services, leveraging its large pool of skilled IT professionals and competitive cost advantage. This phase saw the rise of Indian IT companies such as Infosys, Tata Consultancy Services (TCS), and Wipro, which became synonymous with India’s technological prowess.
Liberalisation and the Technological Revolution in India began in the early 1990s and marked a significant turning point in the country’s economic history. This period witnessed a departure from the previously entrenched socialist economic policies towards a more market-oriented approach. It brought about transformative changes in various sectors, particularly in technology, paving the way for India’s emergence as a global player in the IT industry and beyond.
Key Features of Liberalisation and Technological Revolution include
Economic Reforms: In 1991, faced with a looming economic crisis, the Government of India, under Prime Minister P.V. Narasimha Rao and Finance Minister Dr. Manmohan Singh, initiated a series of economic reforms to liberalise the economy.
These reforms included dismantling the License Raj, reducing trade barriers, deregulating industries, and encouraging foreign investment. The Government also embarked on fiscal consolidation and privatisation programs for state-owned enterprises.
Trade Liberalisation: Trade liberalisation was a central component of the reform agenda. Tariffs were reduced, import licensing was relaxed, and export promotion measures were introduced to integrate India into the global economy. The liberalisation of trade opened up new avenues for Indian businesses to access international markets and facilitated the inflow of foreign capital and technology.
Financial Sector Reforms: The financial sector was liberalised to promote competition, efficiency, and innovation. Reforms included:
Introducing market-based mechanisms such as the National Stock Exchange (NSE) and the Securities and Exchange Board of India (SEBI) transformed India’s capital markets. It facilitated greater participation by domestic and foreign investors.
Technology and IT Revolution: One of the most significant outcomes of liberalisation was the emergence of India as a global leader in information technology (IT) and software services.
The IT revolution in India was fueled by factors such as a large pool of skilled technical talent, a robust education system, and the availability of low-cost labour. Additionally, Government policies such as tax incentives and export promotion schemes provided further impetus to the growth of the IT industry.
Indian IT companies, including Tata Consultancy Services (TCS), Infosys, and Wipro, have emerged as significant players in the global market. They offer a wide range of services, including software development, IT consulting, and Business Process Outsourcing (BPO).
The IT boom contributed to economic growth and employment generation and positioned India as a hub for innovation and entrepreneurship in the technology sector. The growth was driven by increased productivity, investment, and exports and the diversification of the economy into knowledge-intensive industries such as IT, telecommunications, and biotechnology. The IT industry created millions of high-skilled jobs and contributed to developing a knowledge-based economy. However, the benefits of liberalisation were not evenly distributed, and challenges such as unemployment, underemployment, and income inequality persisted. Liberalisation facilitated greater integration of the Indian economy with the global economy, leading to increased trade, foreign investment, and technological transfer. India became a preferred destination for outsourcing and offshoring IT and business services by multinational corporations.
While liberalisation spurred economic growth, it also exposed weaknesses in India’s infrastructure, governance, and regulatory environment. Inadequate infrastructure, bureaucratic inefficiencies, and corruption remained significant impediments to sustained development.
The liberalisation and technological revolution of the early 1990s laid the foundation for India’s emergence as a global economic powerhouse. However, to realise its full potential, India must address key challenges such as infrastructure development, skill enhancement, and inclusive growth. Additionally, continued reforms are needed to further liberalise the economy, improve the business climate, and foster innovation and entrepreneurship.
The Era of Digital India, Innovation Ecosystem and Semiconductor Chip
In recent years, India has strongly emphasised digital transformation and innovation-led growth. Initiatives such as Digital India aim to harness the power of technology to drive inclusive growth, improve governance, and enhance the quality of life for citizens.
The startup ecosystem in India has witnessed remarkable growth, with thousands of young entrepreneurs launching innovative ventures across various sectors including e-commerce, fintech, healthtech, and agritech. Government initiatives such as Startup India and Atal Innovation Mission have played a crucial role in nurturing and supporting startups.
Digital India and the innovation ecosystem represent a transformative vision and strategy to leverage technology to drive inclusive growth, improve governance, enhance citizen services, and propel India into the digital age. Launched by the Government of India in 2015, Digital India is a flagship initiative that encompasses various programs and policies designed to harness the power of information and communication technology (ICT) for socio-economic development.
The initiative focuses on several key pillars like
Infrastructure Development: Digital India emphasises the creation of robust digital infrastructure to connect every part of the country, including rural and remote areas. This includes the expansion of broadband connectivity, the deployment of fibre-optic networks, and the establishment of high-speed internet access points.
Initiatives such as BharatNet aim to provide broadband connectivity to over 250,000-gram panchayats (village councils) across India, bridging the digital divide and enabling access to digital services in rural areas.
Digital Governance: Digital India seeks to transform Government services and processes through technology, making them more accessible, efficient, and transparent.
The initiative promotes the adoption of digital platforms for service delivery, such as the Digital Locker for secure storage of documents, the e-Sign framework for digitally signing documents, and the Unified Payments Interface (UPI) for easy and secure digital payments.
Digital Empowerment: Digital literacy and skill development are key components of Digital India, aimed at empowering citizens with the knowledge and skills required to access and utilise digital services.
Initiatives such as Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA) provide digital literacy training to individuals in rural areas. At the same time, schemes like Skill India focus on enhancing vocational skills for employment in the digital economy.
Universal Access to Services: Digital India aims to make essential services, including healthcare, education, financial services, and agriculture, more accessible to citizens through digital channels.
Projects like e-healthcare, e-education, and e-Krishi provide online platforms for farmers to access healthcare information, educational resources, agricultural advisories, and market linkages.
Innovation and Entrepreneurship: An integral part of Digital India is fostering innovation and entrepreneurship in the digital ecosystem. The initiative aims to create an enabling environment for startups and technology-driven enterprises to thrive. Initiatives like Startup India support startups through funding, mentorship, networking, and policy interventions. The Atal Innovation Mission fosters innovation and entrepreneurship among students through tinkering labs, incubators, and startup challenges.
Cybersecurity and Data Privacy: With the increasing digitisation of services and data, cybersecurity and data privacy have become critical concerns. Digital India includes measures to strengthen cybersecurity infrastructure, enhance data protection mechanisms, and raise awareness about online security among citizens and businesses.
Digital Inclusion and Social Impact: Digital India aims to ensure that the benefits of digitalisation reach all sections of society, including marginalised communities, women, and persons with disabilities. Initiatives like Digital Saksharta Abhiyan (DISHA) promote digital literacy among socially and economically disadvantaged groups, while schemes like Beti Bachao and Beti Padhao (Save Daughters, Educate Daughters) encourage the use of digital technologies to address gender disparities in education and employment.
Digital India has made significant strides in expanding digital infrastructure, enhancing service delivery, and promoting digital literacy and entrepreneurship across the country. The initiative has facilitated greater access to Government services, improved transparency and accountability, and contributed to the digital economy’s economic growth and job creation. Digital platforms and applications have transformed various sectors, including healthcare, education, agriculture, e-commerce, and financial services, leading to greater efficiency, innovation, and inclusion.
Digital India represents an ongoing journey towards building a digitally empowered society and a knowledge economy. To sustain and accelerate progress, there is a need for continued investment in digital infrastructure, human capital, innovation, and regulatory frameworks that foster a conducive environment for technology adoption and entrepreneurship. By harnessing the full potential of digital technologies, India can drive inclusive growth, empower citizens, and position itself as a global leader in the digital era.
Semiconductor Chip
India’s capabilities in semiconductor design and manufacturing have also seen significant advancements. Efforts are underway to establish semiconductor fabs (fabrication units) in the country to reduce dependence on imports and boost domestic chip production. On 13 March 2024, PM Modi laid the foundation stone through a virtual interaction for three facilities, including a Rs 91,000 crore semiconductor fabrication unit by Tata Electronics with Taiwan’s Powerchip Semiconductor Manufacturing Corporation (PSMC) in Dholera, Gujarat.
Another chip assembly, testing, monitoring, and packing (ATMP) unit with a capacity of 48 million per day by Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) in Morigaon, Assam, with an investment of Rs 27,000 crore.
The third semiconductor ATMP unit for specialised chips was set up in Sanand, Gujarat, in partnership with Renesas Electronics Corporation, Japan, and Stars Microelectronics, Thailand. It has a capacity of 15 million per day and an investment of Rs 7,600 crore.
Semiconductors play a vital role in modern technology, enabling the creation of advanced electronic devices that have transformed nearly every aspect of daily life. Their unique electrical properties and versatility make them indispensable in various applications across various industries. Semiconductors have electrical conductivity properties lying between conductors (such as metals) and insulators (such as glass or rubber). They are crucial components in electronic devices and play a fundamental role in modern technology. The behaviour of semiconductors is based on their unique electronic structure, which allows for the control and manipulation of electrical currents.
A semiconductor chip, often simply called a “chip,” is a small piece of semiconductor material (typically silicon) on which electronic circuits are etched or fabricated. These circuits can contain millions to billions of microscopic components, including transistors, diodes, resistors, and capacitors, all integrated into a single semiconductor substrate. Semiconductor chips are the foundation for various electronic devices and systems, playing a crucial role in modern technology.
The chips are used in a wide range of applications across various industries, including:
Due to their wider utility, the chips are fundamental building blocks of modern electronic devices and systems, driving innovation and advancing technology in diverse fields. Their continuous development and integration into new applications contribute to the evolution of digital society and the Internet of Things (IoT)
The “Make in India” initiative launched in 2014 and the “Digital India” initiative launched in 2015 emphasised the importance of domestic manufacturing, including semiconductors. These initiatives aimed to position India as a global manufacturing hub.
The India Semiconductor Mission was launched in 2021 with a total financial outlay of Rs76,000 crore under the aegis of the Ministry of Electronics and IT (MeitY). It is part of the comprehensive SemiconIndia Programme for the development of a sustainable semiconductor and display ecosystem in the country. Envisioned to be led by global experts in the Semiconductor and Display industry, ISM serves as the nodal agency for efficient, coherent, and smooth implementation of the schemes.
The March 13 2024 was the epitome of accomplishment since India’s history started with semiconductor manufacturing in 1984 with a PSU at Mohali, Punjab, called Semiconductor Complex Limited (SCL). This has kindled the hope and conviction of India becoming a global leader through achieving technological excellence, market competitiveness, and industry influence worldwide and with an enduring semiconductor manufacturing ecosystem.
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