March 12, 2007
EDA in India
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Peggy Aycinena - Contributing Editor

by Peggy Aycinena - Contributing Editor
Posted anew every four weeks or so, the EDA WEEKLY delivers to its readers information concerning the latest happenings in the EDA industry, covering vendors, products, finances and new developments. Frequently, feature articles on selected public or private EDA companies are presented. Brought to you by If we miss a story or subject that you feel deserves to be included, or you just want to suggest a future topic, please contact us! Questions? Feedback? Click here. Thank you!

However, globalization is happening. You can fight it kicking and screaming, [but you can‘t stop it]. I live in North America, but I have a foot in Asia as well through my work covering both markets. We see that software has revolutionized globalization. There used to be a disaggregated industry that was regionally specific, but now there is design going on in North America, in Japan, and everywhere else as well.

As the semiconductor industry evolves, so will its supplier companies. The EDA companies are well advised to consider that they, too, are participants in this globalization movement. There will always be a need for local specialists, but more and more of the work they do will affect a global audience. In 15 years, it won’t matter in the least where an EDA company is based, where the R&D is done, where the software is done on the server.  It simply won’t matter.

Meanwhile, with regards to semiconductor manufacturing in India, a new policy statement has just been released by the India Semiconductor Association. I haven’t seen the document in detail as yet (as of late February), but in the past the government of India has shown that they really understood how to support the software market. It took them a while, but they set up special industrialized zones that had tax benefits for setting up software companies in those zones. That enabled the software market to take off, in terms of services, and to a lesser extent, products.

Now the government is trying to do something similar for the electronics industry. One of the things generating a lot of interest is the idea of building a foundry. There are a couple of engagements underway -- one is to set up a fab in Hyderabad. However, there is a debate over whether this makes sense or not.

From my perspective, it’s really a cost-versus-benefits issue. The costs are infrastructure-type costs. The Indian infrastructure is really nascent at this point. It needs to be at a more mature level to support a leading-edge fab. However, it can make sense to have a local foundry because local companies [in India] may not always have the volume, or the muscle, to be able to get what they want from the independent foundries. They might get a better deal from a local fab in terms of negotiating smaller volume devices, but you don’t need a leading-edge fab to do that. A mainstream fab is good enough.

There are fabs today in India, of course, but these are all older technologies in captive fabs for the defense electronics sector. There was just one public/private consortium with a fab at the 1-micron technology level. They brought it down to .35 micron, and then brought it down again. Does that make sense? Not really when you can use Singapore in the region.

So, although it may not make sense to have a fab from an economic or technology perspective, however, it may make sense from a strategic point of view.


An email from Denali

Raju Pudota, Managing Director for Denali Design Systems India, is quoted in the email I received from Denali addressing my questions about EDA in India: "The EDA industry is seeing an upswing in the number of startups innovating for solutions to deliver sub-90 nanometer development, be it in the area of implementation or in the area of enabling simulation of low-power design, multi-voltage solutions, etc."

“Given the success the current EDA industry is enjoying in India, and the availability of the skilled resources developed over the many years the industry has matured in India, India is an ideal choice of location for design centers to take advantage of the readily available skilled labor at a very competitive costs."

"With a focus on providing packaged solutions to its customers, Denali is working towards transitioning the delivery boundary to the customer, where the delivered product will be a combination of IP and embedded software. With an aim to enabling seamless integration of its IP into the customers' systems, Denali is investing in a specialized embedded software team, and building resources in India for research and development activities pertaining to system architecture, flash-file systems, complex algorithms for data management, and portable memory subsystems."

The Denali email also noted:  “With the design teams in India moving up the value chain in terms of the number and the complexity of designs, with the manufacturing industry all set to get rolling, and the support ecosystem beginning to mushroom, India provides an excellent location for EDA industry to set up R&D centers.”

“Today all leading EDA companies have design centers in India. They are clustered around two locations, namely New Delhi and Bangalore, also known as the Silicon Valley of India. Denali has set up a design center in India to focus on providing leading edge EDA and IP solutions to its customers worldwide.”

“[Meanwhile], with cost pressures on the rise, India is continuing to be a hotbed for investment in the EDA space by startups and small EDA companies. This last year has seen a lot of new companies investing in India. ArchPro and Sierra are a couple of examples.”

“Given the worldwide trend pertaining to EDA startups, India will also see an upsurge in the number of EDA startups over the next couple of years. These startups will be funded both by global venture funds (with an India-specific focus), as well as local venture funds. The new semiconductor policy, released by the India government in February 2007, will provide the much needed impetus to fuel this growth.”

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-- Peggy Aycinena, Contributing Editor.

Review Article
  • Number of people March 12, 2007
    Reviewed by 'C V Srinivasan'
    Wonder where the figure of 75,000 VLSI engineers came from ?
    Excluding embedded and software engineers the rough estimates are, for front end and backend included and only, (apologies if any one is grossly wrong) :
    AMD 250
    Conexant 300
    Intel 1,000
    ST 800
    TI 1500
    Freescale 600
    Philips 200
    Marvell 100
    National 200
    nVidia 150
    Samsung 100
    Toshiba 50
    ARM 150
    Service Cos (HCL, Wipro, TCS, TElx, Mindtree, KPIT) 3000
    Sasken 200
    Xilinx 150
    (Add similar numbers for another 25 companies)
    and check your primary school maths adding capability

      9 of 14 found this review helpful.
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  • Difference between hype and reality March 12, 2007
    Reviewed by 'Ramesh Chandra'
    While this article largely presents one view, let us consider some other points. We should separate hype from reality.
    1. India now has a mature IT industry being in business for over 2 decades and with the top 10 companies MCAP of over $ 25 billion (Infosys, TCS, HCL,Satyam and six others) employing over 500,000 people. Yet one has still to see a shrinkwrapped software from any Indian company. Something which small outfits in California produce by the week. So when we talk of EDA tools from India we should first analyse why there is no shrink wrapped software from companies which are significant players worldwide and with tremendous skill, manpower and financial muscle and also worldwide marketing setups.
    2. India produces 1.1 million cars, yet no car is designed in India as a product. Even Tata Motors the ubiquitous Indian automobile company with a turnover of $ 6 billion and mcap of over $ 10 billion designs iits cars in Italy. As against this a much smaller company Skoda in the Czech republic designs cars on its own.
    3. Jobs are given fanciful names which adds to the hype. Call centres who need people to work at night in India (daytime in USA) says in its recruitment advertisment in India "our work times are synchronised to world timings". An EDA company with a development office in Hyderabad (a city in Southern India) calls a simple QC job for pcb software where an engineer is required to just run tests sent from USA and send back reports as "lead software validation engineer"
    4. ISA staff Ms Poornima Shenoy has written that the Indian Electronic Industry will grow to $ 365 billion in 2015. If we take Electronics as say 12 % of the economy, this translates to national GDP of $ 2.8 trillion. Considering that the present GDP is $ 800 billion it would call for a CAGR of 32 % for the economy till 2015 to achieve this figure. Economists call 11 % growth "an overheated economy". India has averaged 8% in best of times. Whether the figures are achievable or not is anybody's guess

      7 of 8 found this review helpful.
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  • EDAWeekly Feedback March 15, 2007
    Reviewed by 'Vipin'
    This article is interesting to read as most of the Semiconductor industry talks in India have been around Design and Manufucturing; very little around EDA.
    1. EDA development in India: Yes, it is possible and it is happenning. I believe there is technical capability to develop new products. Some of the large players are already doing it.
    Hence, it is possible for an Indian EDA company to grow and develop EDA product in India. But they would need to have a big size of their marketing outside India as the state of the art user are NOT yet in India.
    2. Wafer Fabs: again a lot of hype going on but it will take 10-15 yrs to be able to do create the ecosystem to do state of the art. China, Malaysia and of course Taiwan, Singaproe are already there.
    So this is really going to be the opportunity cost and the benefits of being located in India istead of else where: in term of profits, in terms of understanding the market for delivering for the Indian market.
    Nevertheless, manufacturing is good for the economy as it allows a larger pool of employment with lesser qualitfication to earn more and Hence grow the economy.
    3. High tech manufacturing and ATPkg: these would be where the first phase of manufacturing will come from and would be more viable as it requries lesser investment, lesser stringent infrastructure and easier to find or trian resources from the exisiting pool.
    4. In any case: these are the years of OPPORTUNITY in INDIA for the ones who have the vision and the ability to sustain harship: in this century, the world will be supplied by China and India Or will be selling to China and India to make money out of their business.

      2 of 2 found this review helpful.
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  • Nice numbers.. but tell me frankly March 14, 2007
    Reviewed by 'Hemanth'
    I have to agree somewhat that the projections made by the briefing document from ISA is inflated to bring in the 'feel good' feeling. I think the 75,000 engineers figure also mistakenly included the embedded engineers. Also the estimate of the Indian spending on electronics is bloated and half that figure might be a good guess too. And again this hype about the Indian middle class, no there simply arent 400 million as it says, it's amusing where they got that number from. From my reading, I glean its about 250 million and growing slowly, yes slowly. Now my views are so much in contradiction to the estimates is because I dont live in an ivory tower where I am fed some intelligent data, I am just an average indian working in chip design verification, walking the streets of Bangalore and aware of my sorroundings. I dont want to sound cynical but my hopes are tempered with reality- I think rajeev hit spot on with his assessment of the conditions here and pratap was correct in his evaluation for start-ups. As far as starting new business is concerned India dosent have any problem, infact there are more scrips opened and operated in Bombay Stock Exchange(our equivalent to NYSE) than in any other country. We are not new to business per se but EDA or for that matter even Software is a purely engineering endeavor and closely embraces technology. Technology as we know it is something foreign to us, pardon me, I am not naive but this is the truth. Technology has always been driven from the west and we had a lot of catching up to do in manufacturing before we could stand our ground in the world. This is because technology is basically nurtured and cultivated at the grass roots level by the universities and this symbiotic relationship between universities and industry is a determinant of the strength of technical competence. This is one area where India is thoroughly lacking. I dont know why when anyone talks of Indian education they immediately picturize the IITs. Yes IITs are excellent but do you know the percentage of indian engineers who come from IITs, it's << 1%. With some exceptions the rest of the institutions are mediocre or average at best. They are more like extended high schools in disguise. Poor Vic I wonder where he got his idea of a revolution in indian education from. Yes things are changing but slowly yes I repeat slowly. Things do happen in India but they happen slowly and this propensity for slowlness cant be changed.
    So coming back to EDA since this and software is purely an technical undertaking it faces enormous challenges in India and frankly speaking availiability of skilled manpower in these areas is felt. No doubt EDA veterans comming from abroad and settling here would intitiate the surge of startups but ability to sustain and grow is only dependent on the fundamental needs to be addressed in education and business mindset. No wonder we have billion dollar software companies but they dont do any cutting edge applications, they are mainly into servicing because those are the risk free cash cows at present. To be innovative in business requires some daring and risk taking which are conspicuous by their absence in indian technology industry but again we are learning from others and things are changing but slowly mind you.
    Hmm so Vic you thought that our politicians were tech savvy no doubt. There are competent beauracrats here but our politicians are a diffrent brand, you should listen to what they dont say and I hate to say this but beware most of them dont know what they are talking about.
    Overall I am optimistic about EDA in india not because of all those statistics but because the ingredients are there and I know we are learning and growing and thats a recipe for change for the better. Not that we have to but I dont think we will ever be the silicon valley becasue we are oh.. so different.

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  • Problems of Rapid Growth March 13, 2007
    Reviewed by 'Vishwanathan'
    One of the problems the Indian Chip Design Industry is facing is past legacy.
    The Industry grew very fast in the late 90's with a surge in demand of staff. With no history available a lot of inappropriate staff were selected, which no doubt served the purpose at that time. Ten years later the same people have reached the critical middle management level, where on the one hand they are micomanaging downstream project implementation and on the other hand trying to raise the work being done up the value chain.
    Since not all selections in the late 90s surge were appropriate, the industry is saddled with not the best staff for the job but with many upcoming, able and challenging juniors. Those companies who have been able to recognise this problem and taken corrective measures have done well, while some who have not are getting saddled with an inefficient middle management.
    An interesting challenge for the maturing design industry in India

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