India, Singapore Ink Deals to Boost Semiconductor Collaboration Amid US-China Tensions

In a strategic move to capitalise on the ongoing geopolitical tensions between the United States and China, India and Singapore have announced a significant partnership to enhance their collaboration in semiconductors and digital technologies. The aim is to play a more prominent role in the reshaping global chip supply chain.

During Prime Minister Narendra Modi’s two-day visit to Singapore, both nations signed agreements to develop talent in chip design and manufacturing, while encouraging Singaporean investment in India’s tech sector. The partnership also extends to cybersecurity, 5G networks, supercomputing and Artificial Intelligence (AI), as per a statement from the Indian government on Thursday.

With India, Singapore and Malaysia benefiting from the US-China chip war, the global chip market is expected to reach $588 billion (approximately Rs. 49.38 lakh crore) in sales this year. Both China and the West are striving to establish independent supply chains to mitigate geopolitical risks, creating lucrative opportunities for semiconductor businesses.

This partnership aligns with PM Modi’s vision to position India as a global technology leader, with a robust semiconductor ecosystem at its core. During his visit, PM Modi met with Singapore’s Prime Minister Lawrence Wong and other officials. The two countries also signed agreements in health, medicine and skills development.

Welcome PM @narendramodi to Singapore! Delighted to have the chance to catch up over a meal at the Istana, before the official meetings tomorrow. pic.twitter.com/6ceCrKwbAF

— Lawrence Wong (@LawrenceWongST) September 4, 2024

India’s semiconductor sector is still emerging, whereas Singapore has been a major player for decades. The city-state hosts some of Southeast Asia’s largest chip manufacturing plants, including those of industry giants like NXP Semiconductors and Micron Technology. Additionally, Singapore boasts significant expertise in chip research, engineering talent and ample venture capital for startups.

The Indian government has earmarked $21 billion (approximately Rs. 1.76 lakh crore) to boost domestic semiconductor capabilities, with $15 billion (approximately Rs. 1.25 lakh crore) in chipmaking investments announced earlier this year. Singapore’s expertise in memory chips and logic processors could accelerate India’s semiconductor growth.