Govt projects opportunity for NXP in India: Execs

INDIA--NXP Semiconductors said Thursday it expects huge demand in India for its identification products as a result of the country's e-government, transport and financial inclusion projects.

Claus Hansen, NXP's Asia-Pacific senior director, sales and marketing said: "India is a bundle of latent opportunity."

Headquartered in Europe, NXP creates semiconductors, systems and software designed to deliver better sensory experiences in televisions, set-top boxes, identification applications, mobile phones, cars and a wide range of electronic devices.

Ashok Chandak, its senior director of global sales and marketing, said: "We expect 600 million unique ID cards, 50 million e-passports, 100 million health cards, 50 million transport and ticketing cards and 50 million banking cards likely to be issued over the next seven years."

The NXP executives were speaking at the Identification Summit 2009 hosted by the company Thursday for select media.

In India, NXP was the sole supplier of chipsets for the pilot of the Multipurpose National Identity Card Project (MNIC) in 2007, now integrated with the National Authority for Unique Identity (NAUID) under the government's Planning Commission.

The company expects huge demand from the government sector, with the National Rural Employment Guarantee Act (NREGA) coming into force and the India's National e-Governance Plan (NeGP) progressing in full swing.

NREGA seeks to enhance the livelihood of people in rural India by guaranteeing them 100 days of wage employment every financial year and within 5 kilometers (3 miles) of their residence. The NeGP seeks to make all government services accessible to the common man through common service delivery outlets.

NXP offers four kinds of identification offerings--near field communication (NFC) and services, radio frequency identification (RFID), smartcard products and infrastructure components such as ICs and modules for terminals.

Future is contactless
Hansen said NFC is emerging as an important application for mobile phones. Handsets with NFC can be used for keyless entry into one's car, to purchase tickets at toll-roads and in mass rapid transport systems, and facilitate banking transactions.

NFC is a short-range high-frequency wireless communication technology that enables data exchange between devices around 10 centimeters (4 inches) apart.

Mobile phone manufacturers are developing NFC-enabled handsets. For instance, the Nokia 6212C 3G handset featuring NFC lets consumers conveniently share content, access services and information as well as conduct payments and ticketing with one tap of the device.

Hansen said: "Identity cards that have a longer usage span need a contactless interface. Therefore, for e-governance projects like NUID, health cards, driving licenses and e-passports, contactless would be the natural choice."

Contactless is the interface of choice for the 21st century. Governments and banks are moving towards it," he added. NXP's contactless e-government chip has been used in 62 of the 71 countries where the e-passport scheme has been implemented, according to him.

Financial inclusion--the process of delivering affordable banking services to disadvantaged and low-income groups--also has wide scope in India, since banks cover only 39 percent of rural India.

The government has set up a US$125 million financial inclusion technology fund that seeks to bank these rural pockets with the use of new financial inclusion technologies using smart cards, NFC and mobile phones. NXP has been involved in several pilot financial inclusion projects.

Smartcards for railways
NXP also announced its secure microcontroller-based chip technology MIFARE DESFire was selected by the Centre for Railway Information Systems (CRIS), an IT organization under India's Ministry of Railways. The technology will power contactless smart cards for automatic fare collection using automatic ticket vending machines (ATVMs) across various cities in India.

Indian Railways is one of the largest and busiest rail transport networks in the world, carrying over 18 million passengers daily. "Globally, 75 percent of all electronic tickets in public transport use NXP MIFARE technology," Chandak said.

CRIS developed an AVTM as part of an Unreserved Ticketing System (UTS). These ATVMs will be rolled out across five major cities in India--New Delhi, Secunderabad, Kolkata, Bhubaneswar and Pune. The project is expected to go live in September 2009.

Swati Prasad is a freelance IT writer based in India.