Microchip joins parade of chip firms investing in India

Microchip in recent days announced a $300 million investment into chip R&D efforts in India, the latest of multiple moves by semiconductor companies to invest in and locate facilities in the country as geopolitical factors continue to affect the sector.

The investment by Chandler, Arizona-based Microchip will go toward expanding the firm’s existing operations in India, which the company described as “one of the world’s fastest-growing semiconductor industry hubs.”

“Microchip is making a significant strategic commitment to growing our operations in India, whose meteoric growth has established it as one of the top sources of business and technical resources in our sector,” said Ganesh Moorthy, President and CEO of Microchip. “Our investments here will enable us to both benefit from and contribute to the country’s increasingly important role in the global semiconductor industry.”

Specifically, Microchip outlined plans to improve its existing facilities in Bangalore and Chennai, along with an effort to build a new R&D center in Hyderabad. This announcement comes after Applied Materials late last month announced that it would build a collaborative engineer center in Bangalore. That news arrived the same week that Micron Technology committed to build a new DRAM and NAND assembly and test facility in Gujarat, India.

All of these announcements arrive as tensions between China and Taiwan continue to concern the rest of the world, with many reports suggesting that a military conflict between the two countries would prove catastrophic for the global economy and specifically the semiconductor sector, as the majority of the world’s chips continue to be manufactured in Taiwan. India has been emerging as an alternative, and India’s government has been upping its game over the last two years, through initiatives like the India Semiconductor Mission, to woo more semiconductor companies from around the world to locate facilities there.

In an email exchange with Fierce Electronics, Moorthy said his company’s announcement was more about growing its presence in a country where it has operated for decades. “Microchip has been committed to R&D in India for more than 25 years,” he said. “Our expansion plans would have happened regardless of geopolitical tension.”

He also pointed out that even as Microchip expands in India, it continues to grow its domestic operations in the U.S. as well. Back in February of this year, Microchip announced plans to invest $880 million to expand silicon carbide and silicon chip production in Colorado. Earlier this year, the company also reached the halfway point in its $800 million multi-year initiative to triple semiconductor production at its facility in Oregon.