According to livemint.com, Applied Materials Inc. has pledged a $5 billion investment in India over 10 years to build a semiconductor research and development laboratory and develop a local supply chain supporting its global product development.
Lab, Clean Room, and Engineering Talent
Prabu Raja, president of the semiconductor products group at Applied Materials Inc., stated in an interview with Mint that the company will use the $5 billion investment to construct a lab and clean room in India “where we develop products in India.” He emphasized the need to build domestic engineering expertise, saying the initiative will involve hiring “a lot of people for semiconductor product development.” The announcement was made on Thursday at Semicon India 2026 held at New Delhi’s Yashobhoomi convention centre.
Raja noted that shortening product-development cycles requires tighter integration between design and supply chain. “If the supply chain and us work in one place together, we reduce the number of iterations and increase the product development pace,” he explained. Semiconductor product-development cycles can take as long as 10 years, and proximity to skilled engineers helps accelerate progress — though specialized training remains critical.
The company’s India entity was established in 2003. Its latest filings with India’s Ministry of Corporate Affairs, accessed via Tofler, show revenue of ₹ 2,708 crore in FY25 — an increase of 12% year-on-year.
Building on Prior Commitments
The new $5 billion pledge expands on Applied Materials’ earlier $400 million investment announced in June 2023 to establish an engineering hub in Bengaluru. With this expansion, the company plans to scale up chip-design and product-development activities across India, aiming to localize more of its global supply chain. “Right now, most of the supply chain is global and getting the parts from outside takes a lot of time,” Raja said.
This strategy aligns with national priorities: on 18 August, S. Krishnan, secretary at the Ministry of Electronics and Information Technology (MeitY), stated that India’s semiconductor supply chain “is attracting increasing global investments as more and more global manufacturers set up shop here—creating an ecosystem as the industry develops.”
Applied Materials, currently valued at $332 billion, reported global operating revenue of $9.12 billion for the May–July 2026 quarter — up 25% year-on-year. The company forecasts nearly 40% revenue growth this year, citing strong customer demand and multi-year deals.
Global Context and Market Momentum
Raja highlighted accelerating global semiconductor demand driven by AI infrastructure expansion. He noted the global semiconductor industry has already crossed $1 trillion, while the semiconductor equipment market is expected to exceed $150 billion this year. “We’ve tracked a lot of how many fabs are coming up. We see more than 100 fabs coming up worldwide,” he said — pointing to opportunities tied to memory-chip shortages and rising demand.
At Semicon India 2026, Tata Electronics — developing India’s first commercial chip fabrication plant — signed seven memorandums of understanding with semiconductor supply-chain companies, reinforcing the broader momentum behind India’s chip ecosystem.
Source: livemint.com
Compiled from international media by the SCI.AI editorial team.
