Can Quad alliance redefine the semiconductor supply chain?

The Quadrilateral Security Dialogue between India, the US, Japan and Australia wants to protect supply chains in critical areas like semiconductors and 5G.

Gagandeep Kaur, Contributing Editor

September 30, 2021

3 Min Read
Can Quad alliance redefine the semiconductor supply chain?

The Quadrilateral Security Dialogue or Quad Alliance between India, the US, Japan and Australia has decided to work together to protect supply chains in critical technology areas like semiconductors and 5G.

"We are mapping the supply chain of critical technologies and materials, including semiconductors, and affirm our positive commitment to resilient, diverse, and secure supply chains of critical technologies, recognizing the importance of government support measures and policies that are transparent and market-oriented," says the statement issued by the White House.

This is significant because it comes at a time when all geographies are experiencing a massive chip shortage.

Figure 1: Precious metals: Can the Quad Alliance fix the global semiconductor supply chain? (Source: on Unsplash) Precious metals: Can the Quad Alliance fix the global semiconductor supply chain?
(Source: on Unsplash)

Device consumption shot up during lockdowns due to the COVID-19 pandemic, even as the manufacturing came to a standstill. On top of this, geopolitical tensions between the US and China contributed to the breakdown of semiconductor supply chains.

What further adds to the uncertainty is that Taiwan, the largest chip manufacturing country, is geographically closer to China. Globally, the US is the market leader, while China is the biggest consumer of chips.

Go it alone

Several nations, including India, are trying to be self-reliant to reduce dependence on other countries for semiconductors. The Indian government has said it will provide financial support and other incentives to encourage chip manufacturers to set up here.

Similarly, Japan has increased output at existing units and is also planning to set up new manufacturing centers. Japan is a major supplier and exporter of raw materials required for chip manufacturing to Taiwan. This gives it an advantage over other countries.

Further, media reports suggest that India and Taiwan are in talks to help India set up a chip manufacturing unit in India. Chip manufacturing is a specialized area that demands a massive water supply, uninterrupted power and workforce resources. Even as the nations try to become self-sufficient, there is a growing realization that they need to collaborate because it takes years to develop the right competencies.

My enemy's enemy

Quad countries have other reasons to collaborate. For example, India and China indulged in clashes on the border last year, which eventually led to India banning several Chinese apps and restricting the use of Chinese equipment in communications networks.

Interested in Asia? Check out our dedicated content channel here on
Light Reading.

While Australia has recently signed a security pact with the US and the UK, largely believed to attempt to counter China’s influence in the region.

Since there are several areas of collaboration between the four countries - it is possible that together they will be able to have a parallel supply chain which will help bring down dependency on Taiwan as the supplier of chips.

— Gagandeep Kaur, contributing editor, special to Light Reading

Read more about:


About the Author(s)

Gagandeep Kaur

Contributing Editor

With more than a decade of experience, Gagandeep Kaur Sodhi has worked for the most prominent Indian communications industry publications including Dataquest, Business Standard, The Times of India, and Voice&Data, as well as for Light Reading. Delhi-based Kaur, who has knowledge of and covers a broad range of telecom industry developments, regularly interacts with the senior management of companies in India's telecom sector and has been directly responsible for delegate and speaker acquisition for prominent events such as Mobile Broadband Summit, 4G World India, and Next Generation Packet Transport Network.

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like