The American company Applied Materials, a manufacturer of equipment used in the production of microchips, announced its intention to expand the scale of its activities in India.

The firm stated that the decision to activate the business in the mentioned country is based on two factors. The company is convinced that the policy of the Government of India to support the technology sector creates positive prospects. The firm also assumes in its decision that the abundance of talent in the local labor market will create a solid foundation for the successful development of the semiconductor manufacturing industry.

Prabu Raja, president of the company’s semiconductor products group, suggests that India is currently on its way to becoming a major semiconductor packaging and assembly center. According to him, the country’s current efforts in this direction in the future will create a basis for the subsequent transition to a more complex and expensive level of production of high-tech products. He also noted that packaging is an important turn that will happen, and called this vector of development the right approach.

Indian Prime Minister Narendra Modi spoke in support of stimulating the growth of the semiconductor sector. As part of the implementation of the relevant efforts, a fund was created with financial resources in the amount of $ 10 billion. This fund was founded to gain chip manufacturers in India.

Also, Narendra Modi, in the context of broader planning for the development of the technology sector, announced plans to create a kind of production cluster called Make in India, which has already received investment funds from Apple suppliers.

Micron Technology, an American company specializing in the production of memory chips, is currently building a semiconductor assembly and testing plant in the western Indian state of Gujarat. The cost of this project is $2.75 billion. The Narendra Modi administration provides financial support to the American manufacturer as part of its efforts to operate in India.

In June, Applied Materials announced its intention to invest $400 million to establish an engineering center in Bangalore. This funding will be allocated in stages over four years. The company already operates a research center in Bangalore.

Prabu Raja said that the firm will not assemble chip manufacturing equipment in India in the near future. According to him, the engineering center in Bangalore will be designed to work with suppliers and partners in the development of new products.

Currently, the Prime Minister of India adheres to the strategy of taking advantage of the country’s geopolitical position in the context of establishing business relations with the United States. Narendra Modi intends to establish a partnership with the USA in the technology sector. In a certain sense, he is taking advantage of the moment and trying to make the most of the circumstances in which Washington cannot reach an understanding with Beijing on technological cooperation.

On Friday, July 28, Narendra Modi said at a conference in Gujarat that the world needs a reliable supply chain and noted that there could be no better partner than the largest democracy in the world.

Semiconductor manufacturing is a very complex and expensive process. Prabu Raja says that India can begin its success story in this industry with the packaging process, which involves installing circuits on a silicon wafer or chip.

Prabu Raja also stated that the level of trust in Indian technical capabilities has increased significantly. He noted that many Indians work in Silicon Valley.

As we have reported earlier, Amazon to Invest $26 Billion in India by Decade’s End.