Mint Explainer | India invited to Pax Silica: What it could mean for AI, chip supply chains

Core Insights - The US is inviting India to join Pax Silica, a strategic initiative aimed at securing the global silicon supply chain in the AI era [1][2] Group 1: Overview of Pax Silica - Pax Silica is designed to identify trusted partner nations to enhance AI efforts and create a robust global supply chain for silicon and related materials [3] - The initiative includes countries such as the US, Japan, South Korea, Singapore, the Netherlands, Israel, UAE, the UK, and Australia, with India potentially joining [3] - Each participating nation is expected to contribute unique strengths in areas like critical minerals, advanced manufacturing, semiconductor capability, and AI innovation [3] Group 2: Importance for India - India's participation in Pax Silica would signify its role in shaping future supply chains for AI and advanced computing [7] - The Indian government emphasizes the strategic importance of being involved in critical mineral security discussions [8] - India's existing initiatives in AI and semiconductors align with Pax Silica's objectives, including the India AI Mission with a ₹10,372 crore budget and the India Semiconductor Mission with a ₹76,000 crore allocation [9] Group 3: India's Technological Landscape - India hosts over 2,975 global capability centers (GCCs), employing nearly 1.9 million professionals, highlighting its significant role in the global tech ecosystem [10][11] - Major multinational investments, such as Microsoft's $17.5 billion investment in AI and cloud infrastructure in India, further strengthen its positioning [11] Group 4: Geopolitical Context - Pax Silica reflects a strategic shift where economic tools are increasingly used for geopolitical ends, particularly in the context of reducing dependence on China [12][13] - China's dominance in critical supply chains, especially in rare earth materials, has prompted India to support domestic manufacturing initiatives [14] - India's potential contributions to Pax Silica include its large market for new technology and its integration into the global tech ecosystem [15]