August 1, 2023 /SemiMedia/ -- Applied Materials, a maker of semiconductor manufacturing equipment, is expanding in India, according to Bloomberg. India is becoming a major center for semiconductor packaging and assembly, said Prabu Raja, group president of Applied Materials. This will provide a solid foundation for the industry, setting the stage for India to move into more challenging and costly semiconductor manufacturing.

"Chip packaging is the next big shift that's about to happen, and it's the right path," Prabu Raja said in an interview.

Prime Minister Narendra Modi has been vigorously promoting the semiconductor industry, including launching a $10 billion fund nearly two years ago to lure chipmakers. Indian Prime Minister Narendra Modi said that with the announcement of investment plans by multinational companies such as Foxconn and AMD, India hopes to become a reliable partner of the semiconductor industry and the world's chip manufacturers.

Micron Technology is building a $2.75 billion semiconductor assembly and testing plant in the western Indian state of Gujarat. Applied Materials said last month it would invest $400 million over four years to build a new engineering center in Bengaluru, where it already has a research center.

U.S. chipmaker AMD also said it would invest about $400 million in India over the next five years, build its largest design center in the Bengaluru tech hub, and create 3,000 new engineering jobs within five years.

Prabu Raja said that while they have not yet assembled chip-making equipment in India, they will use the new center to work with suppliers and partners on new products.

"Confidence in India has risen over the past few years," Prabu Raja said. “If you look at the global semiconductor ecosystem in Silicon Valley, there are a lot of Indians. Companies coming to India may use a combination of talent from global hubs and from India.”