The U.S. Transportation Command (TRANSCOM) is conducting logistics-focused military exercises across East Asia this summer to enhance regional response capabilities amid rising tensions with China over Taiwan and the South China Sea. These drills aim to test and improve logistics architecture, infrastructure, and rapid deployment strategies, vital for crisis response and regional security. TRANSCOM Commander Gen. Randall Reed emphasized that the exercises part of the “Mobility Guardian” operation are designed to ensure freedom of movement and swift mobilization of troops and supplies from the U.S. to various strategic points in Asia. These operations will also test tactics, logistics planning software, and real-time coordination tools with allies to boost regional interoperability. The military’s approach mirrors broader commercial logistics trends such as demand forecasting, real-time logistics planning, and adaptive distribution networks key components of modern logistics and supply chain management. In today’s volatile environment, logistics chain management and resilient distribution strategies are essential not just for defense, but for global business continuity. As both military and commercial sectors adopt digital logistics platforms and smarter logistics packaging solutions, strategic preparedness is becoming a vital part of future-proofing supply chains in East Asia and beyond.

Malaysia is urging businesses to prioritize resilience, agility, and adaptability in their supply chain strategies as global disruptions from rising geopolitical tensions become more frequent. Investment, Trade, and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz emphasized the need for regional cooperation, especially through ASEAN, to safeguard supply chain continuity. At the recent ASEAN-GCC-China Summit, ASEAN demonstrated its coordinated approach to global economic challenges. The event sent a strong message: ASEAN is open for business and ready to shape a resilient, interconnected global economy. Malaysia reiterated its commitment to the ASEAN Comprehensive Recovery Framework (ACRF) and the ASEAN Single Window (ASW), a digital platform designed to streamline intra-ASEAN trade by cutting red tape and improving efficiency. Intra-ASEAN trade already accounts for nearly 25% of the region’s total trade. Malaysia is also backing the ASEAN Digital Economy Framework Agreement (DEFA) to harmonize digital trade laws and speed up cross-border e-commerce. With ASEAN contributing around 7% of global trade, digital tools like supply chain management software, digital supply chain financing, and future tracking solutions are seen as key to sustaining growth amid global uncertainty.

The Global Chip Race In 2025, semiconductors have firmly established themselves as the foundation of the global digital economy. From smartphones and electric vehicles to defence systems and AI technologies, microchips are integral to every facet of modern innovation. As geopolitical tensions intensify, especially between the United States and China, semiconductors have become a symbol of strategic power and national security. The world is witnessing a “chip war,” where countries are racing not only to secure chip supplies but to control the means of their production, design, and innovation. In this global realignment, India is stepping up with a bold ambition: to become a credible and self-reliant semiconductor powerhouse. India’s current semiconductor demand stands at approximately USD 52 billion (2024), projected to cross USD 103 billion by 2030, driven by rapid digitization, increased electronics manufacturing, and rising domestic consumption in sectors like automotive, telecom, and consumer electronics. However, nearly 85% of this demand is currently met through imports, mostly from Taiwan, China, South Korea, and the U.S., highlighting a deep vulnerability in India’s tech supply chain. Global semiconductor shortages during the COVID-19 pandemic and the Russia-Ukraine war exposed India’s dependence on imports, pushing policymakers to accelerate efforts toward establishing a domestic semiconductor ecosystem. To address this gap, the Government of India launched the India Semiconductor Mission (ISM) under the Ministry of Electronics and Information Technology (MeitY), with a $10 billion (INR 76,000 crore) incentive scheme. The program aims to develop end-to-end semiconductor manufacturing and design infrastructure in India, from fabs and OSAT (Outsourced Semiconductor Assembly and Test) units to chip design centres. This initiative is supported by state-level semiconductor policies, such as those in Gujarat, Uttar Pradesh, and Tamil Nadu, which offer capital subsidies, land allocation, and plug-and-play infrastructure to global investors. India has already secured strategic investments under this mission. Tata Electronics is setting up a $10.4 billion fabrication facility in Dholera, Gujarat, in partnership with Taiwan’s Power-chip Semiconductor. U.S.-based Micron Technology is establishing a $2.75 billion assembly and testing plant in Sanand, and Foxconn has teamed up with HCL for a display chip unit in Greater Noida. In addition, talks are underway with global players like Tower Semiconductor, AMD, Lam Research, and Renesas, reflecting growing international confidence in India’s policy direction. India’s chip ambition is also intertwined with global geopolitics. As the U.S. and its allies attempt to reduce dependence on China and Taiwan, India is increasingly being viewed as a strategic partner in creating an alternative, resilient supply chain in the Indo-Pacific region. Through frameworks like the US-India Initiative on Critical and Emerging Technologies (iCET) and Quad Semiconductor Supply Chain Initiatives, India is leveraging diplomatic and trade alliances to gain access to cutting-edge semiconductor tech and R&D. India's Semiconductor Ambitions India’s semiconductor industry is rapidly emerging as a strategic pillar in the country’s quest for technological self-reliance and economic transformation. Valued at approximately USD 52 billion in 2024, the Indian semiconductor market is on a steep growth trajectory and is expected to more than double, reaching USD 103.4 billion by 2030, according to industry analysts. This surge is being driven by rising demand in sectors such as smartphones, laptops, electric vehicles, consumer electronics, 5G infrastructure, and the growing adoption of Internet of Things (IoT) devices. However, despite this optimistic outlook, a significant challenge persists—India imports nearly 85% of its semiconductor requirements, heavily relying on countries like Taiwan, South Korea, China, and the United States for both raw chips and finished electronic components. This import dependency became glaringly visible during the COVID-19 pandemic and the subsequent geopolitical shifts, which disrupted global semiconductor supply chains. The shortage impacted critical sectors in India such as automobile manufacturing and electronics, prompting an urgent call for building a resilient, domestic semiconductor ecosystem. Recognizing the strategic and economic risks of continued reliance on external sources, the Indian government launched an ambitious policy initiative: the India Semiconductor Mission (ISM). The ISM is a comprehensive roadmap designed to position India as a global hub for semiconductor manufacturing, design, and innovation. Backed by a USD 10 billion (INR 76,000 crore) incentive package, the mission focuses on creating the infrastructure, talent pool, and policy environment needed to attract global semiconductor manufacturers and encourage domestic capabilities. The incentives are being offered under a structured framework that includes Production Linked Incentive (PLI) schemes, support for display fabrication units, design-linked incentives for chip design startups, and capital assistance for building semiconductor fabs and ATMP (Assembly, Testing, Marking and Packaging) units. One of the key elements of the ISM is its emphasis on public-private collaboration. The Indian government is actively seeking partnerships with global semiconductor giants to bring in technological expertise, best practices, and critical investments. This includes collaboration with companies like Tata Electronics, Micron Technology, Foxconn, and Tower Semiconductor, among others. These companies are setting up large-scale semiconductor fabrication and testing facilities in India, with projects underway in Gujarat, Uttar Pradesh, and Maharashtra. For instance, Tata’s USD 10.4 billion fab in Dholera, being built in partnership with Taiwan's Powerchip Semiconductor, is expected to produce 50,000 wafers per month for sectors like automotive and computing. Meanwhile, Micron’s facility in Sanand is set to become operational by 2025, boosting India's backend processing capabilities. Key Developments and Investments 1. Tata Electronics' Strategic Moves Tata Electronics is at the forefront of India's semiconductor endeavours. The company is investing over INR 910 billion (approximately USD 10.44 billion) to establish a semiconductor fabrication plant in Dholera, Gujarat, in collaboration with Taiwan's Power chip Semiconductor Manufacturing Corporation. This facility aims to produce 28nm chips, catering to sectors like automotive, computing, and AI. Additionally, Tata is setting up an Outsourced Semiconductor Assembly and Test (OSAT) facility in Jagiroad, Assam, with an investment of INR 27,000 crore (around USD 3.6 billion). This plant is expected to generate over 25,000 jobs and bolster India's capabilities in semiconductor assembly and testing. 2. HCL-Foxconn Joint Venture The Indian government has approved a new semiconductor unit by the HCL-Foxconn joint venture, involving an investment of INR 3,706 crore. Located near the upcoming Noida International Airport in Uttar Pradesh, this facility will focus on semiconductor assembly and testing, contributing to the region's industrial development. 3. Micron Technology's Investment Micron Technology is establishing a semiconductor assembly and test facility in Sanand, Gujarat, with full operations expected by the end of 2025. This project is part of a broader investment push in the state, totalling INR 15,000 crore, aimed at building a comprehensive semiconductor value chain. 4. Lam Research's Commitment U.S.-based Lam Research plans to invest over USD 1 billion in India's Karnataka state to enhance the semiconductor ecosystem. This investment aligns with India's efforts to expand its semiconductor industry and is expected to boost the country's manufacturing capabilities.