According to a report in Japan’s Nikkei newspaper, the United States, Japan, India, and Australia are likely to sign an agreement to take steps to build secure semiconductor chip supply chains when they meet in Washington for the Indo-Pacific Quad summit next week.
The move is intended to reduce reliance on an increasingly assertive China for semiconductor chips.
According to the newspaper’s website, the statement also states that the use of advanced technologies should be based on the rule of respecting human rights.
The chip shortage is widespread, affecting even Indian auto and smartphone manufacturers.
The legislation to provide a staggering $190 billion package to beef up the country’s ability to compete with Chinese technology has already been approved by an overwhelming majority in the United States Senate.
The bill authorises the largest-ever funding for technology research, semiconductor development, and manufacturing in American history, as well as subsidies for robot and chip manufacturers. The computer chip shortage has hampered auto production at major US companies such as GM at a time when global demand is increasing.
According to US Commerce Secretary Gina Raimondo, the funding is on a large enough scale to allow for the establishment of up to seven to ten new US semiconductor plants.
US President Joe Biden is continuing with his predecessor Donald Trump’s hard line as far as China is concerned. He has blacklisted over 50 Chinese companies because of their links to Beijing’s “military-industrial complex.” US companies and investors are barred from entering into any deals with these companies.
These firms are suspected of stealing US technology and using it to bolster China’s military and fuel its belligerent foreign policy, which has emerged as a concern in Asia and the Indo-Pacific region.
The Trump administration has placed dozens of Chinese companies on a trade blacklist, including telecom giant Huawei, top chipmaker SMIC, and drone manufacturer SZ DJI Technology.