Should an Indian investor buy Qimonda?

BANGALORE, INDIA: As I was about to call it a day (or evening), I happened to glance at my own article: India needs to rethink its semiconductor strategy? There, I find that a reader has left a beautiful suggestion for the Indian semiconductor industry: BUY QIMONDA! Why not?

Reader Steve Workman says: "An Indian investor must seriously look into Qimonda. If they throw in a billion dollars now, it might be worthwhile if they can build up fabs in India for memory production. If the fabs in India perform well, this might well be a good investment into the mid-term future of the Indian semiconductor industry. Other players will be sure to give India a look-in then."

That is quite a thought!

The other day, a friend was asking me why Qimonda's story had made it to Editor's Choice on CIOL? Well, Qimonda is the major memory company in the news (and not for good ones)! Memory is tricky business, and semiconductors, the mother of all tricky businesses.

And it is a wonder that, so far, Qimonda hasn't been bought over by someone else!

Great! Here is a possible chance for an India investor!

As the reader says, if an investor can throw in a billion dollars into Qimonda, we can very well solve the fab 'puzzle' in one stroke! Memory fabs can be built in India, and the country could look to become a major player in the memory market. And that would be a great investment in the Indian semiconductor industry.

Yes, I agree with Future Horizons' Malcolm Penn that the Indian semiconductor industry, in its current state, needs a very serious re-think!

Consider these points: In the current economic environment, is the interest in developing new business relations with India a top priority? Probably not, at this very point of time! 

India is also seen more as a source of resource; and the extra resource is the last thing firms need at the moment. What global firms are looking for are new markets and customers, and these points, along with its infrastructure, have been the areas of Indian weaknesses. Maybe, all of this will change, but definitely not overnight!

This suggestion of investing in Qimonda is indeed a vision. Can the Indian semiconductor industry develop the courage to show and work toward making this kind of a vision a reality?

What should India do to develop products?

I had a very quick word with Anil Gupta, managing director, India Operations, ARM, and asked him: does India have the capability to sustain or even build a product development ecosystem? What needs to be done?

He said: "We need the following for this: Entrepreneurs committed to product development and willing to take that risk; investors willing to take risk on product development companies; consumption, and this will happen as the economy improves any way, and finally, deep enough technical/technological knowledge/know-how to put reasonably competent end products together."

He added that all of this exists in India, and cited examples of companies such as Sukam, Tejas, etc.

Well, there you have it!

Do we have such enterprising entrepreneurs in India who are committed to product development and willing to take that risk? Especially in semiconductors?

Will they even consider buying Qimonda and starting a memory fab in India? Will the investors, if any, be willing to take risk on product development companies, especially, if such a move actually happened?

India, you have taken the early steps, but you still have miles to go!! Here's a possible opportunity in front of you!

Dream big, India!