During Indian Prime Minister Narendra Modi's recent visit to Malaysia, India and Malaysia pledged to deepen their partnership in the semiconductor industry, alongside strengthening trade and security links. The two nations inked several agreements, including those focused on renewable energy, healthcare, and artificial intelligence. This visit, the first by Modi in over a decade, underscores the growing strategic importance of the relationship between the two countries.
"Along with AI and digital technologies, we will advance our partnership in semiconductors, health, and food security," Modi stated, highlighting the multifaceted nature of the collaboration. Malaysian Prime Minister Anwar Ibrahim echoed this sentiment, emphasizing the strategic importance of the partnership for enhancing relations between the two nations.
The strengthened collaboration arrives as India aims to become a global semiconductor hub, supported by initiatives like the Production Linked Incentive (PLI) scheme. Malaysia, already a significant player in the global semiconductor market, ranks sixth in worldwide exports of semiconductors, contributing approximately 25% of its gross domestic product.
The partnership extends beyond semiconductors to encompass digital technologies and artificial intelligence, marking a strategic pivot towards technology and emerging sectors. Both countries are committed to "economic transformation through strategic trust," fostering deeper integration in areas like AI and the digital economy. This includes easing citizen mobility and enhancing security cooperation.
Following high-level meetings in Putrajaya, the two leaders witnessed the exchange of 11 cooperation agreements. These agreements span key areas such as the semiconductor industry, disaster management, and peacekeeping. Both countries aim to boost bilateral trade beyond the previous year's $18.6 billion and promote the use of local currencies for transactions. Security cooperation will also be enhanced through joint co-chairmanship of the ASEAN Defence Ministers' Meeting (ADMM) Plus Counter-Terrorism Working Group for 2024–2027.
Furthermore, IIT Madras Global and Malaysia's Advanced Semiconductor Academy (ASUM) have announced a partnership to boost talent development, skilling, and research across chip design, fabrication, and testing, aligning India's Semiconductor Mission 2.0 with Malaysia's strong semiconductor ecosystem. The collaboration will focus on building a future-ready talent pipeline in semiconductor and IC design, with emphasis on the automotive industry, robotics, and next-generation intelligent mobility sectors.