World Semiconductor Council Calls on India to Join ITA Expansion Talks

by Semiconductor Industry Association

Today, semiconductor executives representing the six regional delegations of the World Semiconductor Council (WSC) sent a letter to Prime Minister Singh of India urging his government to support the Information Technology Agreement (ITA) expansion effort:

“The WSC understands India’s desire to grow its semiconductor design and manufacturing base.  In this context, the elimination of tariffs on ICT products as a direct benefit of an expanded ITA will create further demand for semiconductors, thus increasing the need for additional design and manufacturing investments in the sector worldwide.

In light of the above, the WSC calls for the Government of India to participate in the current negotiations to expand the ITA, supporting its expansion to make it a driver of exports, productivity, innovation and enhanced manufacturing capabilities of high tech goods including semiconductors.”

The letter’s signatories include the chairmen of the Semiconductor Industry Associations in China, Chinese Taipei, Europe, Japan, Korea, and the United States.

The WSC brings together industry leaders from six regions to address issues of global concern to the semiconductor industry. The WSC has the goal of promoting cooperative semiconductor industry activities internationally in order to facilitate the healthy growth of the industry from a long-term, global perspective. It also supports expanding the global market for information technology products and services.

In May 2012, the WSC embraced the expansion of the ITA and also provided negotiators with a suggested definition of multi-component (MCOs) semiconductors – a definition that is now used as the basis for duty-free coverage for these integrated circuits.  These semiconductor executives encouraged all international parties to provide for duty-free treatment for semiconductor devices, acknowledging the strong role chips play in enabling economic growth and societal welfare.  The historical WSC Joint Statement  is available here.

The chairmen of the regional delegations expressed the potential ITA benefits to India as follows in the letter:

“According to available sources India contributes to around two-thirds of developing country exports of IT services to industrialized countries.  In our opinion this excellent performance is likely due in major part to the openness of India under the current ITA to equipment that makes access to the internet possible and ICT applications, especially for small and medium enterprises. We believe that expanding the ITA’s product and geographic coverage would further enhance the ITA’s benefits in those regions wanting to boost their ICT exports and reduce costs for consumers.  For instance, expanding the ITA’s coverage to include new semiconductor products like multi-chip packages (MCPs) and multi-components (MCOs) – a priority for all six WSC regions – will benefit semiconductor designers, manufacturers, and customers worldwide.”  

The next official meeting of the WSC will occur in Europe – a week before the May round of ITA negotiations.  CEOs representing each of the six regions will meet there to discuss policy initiatives affecting the worldwide industry and areas for potential cooperation.

On a related note, member companies and staff of the Semiconductor Industry Association (SIA) in the United States will again be in Geneva, Switzerland this week to encourage support for the ITA’s coverage of semiconductor equipment, materials and tools, semiconductor devices like MCPs and MCOs, along with downstream ICT products that use chips.  Likewise, SIA is encouraged by the recent strong statement of support by the APEC ministers for successfully concluding negotiations of a “commercially meaningful” ITA expansion by mid-year.