Supply chains of global semiconductor industry may be further disrupted due to Russia Ukraine conflict

The supply chains of global semiconductor industry, which was badly affected during the COVID-19 period, may see further disruptions due to the Russia-Ukraine conflict, Parliament was informed on Friday.

The conflict may have particular impact on the supply of neon and hexafluorobutadiene gases that are essential to manufacture semiconductor chips as these are used in the lithography processes for chip production, Minister of State for Electronics and IT Rajeev Chandrasekhar said in a written reply to the Rajya Sabha.

Ukraine and Russia are major sources of neon and hexafluorobutadiene gases.

“Russia-Ukraine conflict has impacted supply chains in numerous sectors, including semiconductor industry,” the minister said.

He was responding to a question on whether the ongoing war between Russia and Ukraine will have a bearing on production of semiconductor chips and any adverse impact on the automobile industry.

“The global semiconductor industry is already facing a shortage due to supply chain disruptions during the COVID-19 period. The Russia-Ukraine conflict might cause extra disruptions and affect supply chains of semiconductors,” Chandrasekhar said.

The semiconductor chip shortage has impacted many industries worldwide with auto and electronics industries among the most affected sectors. The shortage first emerged after the COVID-19 pandemic due to lockdowns and restrictions.

He asserted that the government is very focused on bolstering the overall semiconductor ecosystem and ensuring that it catalyses India’s rapidly expanding electronics manufacturing and innovation ecosystem.

The government’s Rs 76,000-crore semiconductor programme focuses on development of chips and display manufacturing ecosystem in the country.

It aims at providing financial support to companies investing in semiconductors, display manufacturing and design ecosystem, and will boost India’s growing presence in the global electronics value chains. PTI