Malaysia Doubles Down on Semiconductor Ambitions with RM100 Million Fund and New IC Design Park

Selangor launches Ehsan Capital to boost chip design startups and unveils Cyberjaya IC Design Park 2 to strengthen its role in Asia’s semiconductor value chain.

Malaysia is sharpening its focus on semiconductor innovation as the Selangor government launches the Selangor Semiconductor Fund, also known as Ehsan Capital, alongside the opening of Malaysia Semiconductor Integrated Circuit (IC) Design Park 2 in Cyberjaya.

The initiative—developed through a collaboration between the Selangor Information Technology and Digital Economy Corporation (Sidec), Permodalan Negeri Selangor Bhd (PNSB), and Artem Venture Fund—aims to support Malaysia’s growing semiconductor ecosystem and position Selangor as the nation’s leading innovation hub for chip design and digital infrastructure.

Fueling Malaysia’s Semiconductor Growth with RM100 Million

During the launch, Selangor Menteri Besar Dato’ Seri Amirudin Shari announced that Ehsan Capital is targeting to raise more than RM100 million and will officially commence operations later this month. He said the fund plans to back a minimum of seven promising Malaysian startups in semiconductor design and related technologies, positioning it as a key initiative to bolster the country’s homegrown semiconductor sector.

“This fund is not just a financial instrument but a long-term commitment to nurture local expertise in research, development, and technological design,” Amirudin said. “Malaysia must evolve from being a user of technology to becoming a regional innovator.”

A Dual Strategy: Capital and Capability

The fund complements Malaysia’s New Industrial Master Plan (NIMP) 2030, which aims to elevate the nation into the top 30 global economies by the end of the decade.
Amirudin noted that semiconductor investments—backed by initiatives like the ARM Design Token Program—could help startups scale and list publicly within three to four years, spurring greater venture capital participation and investor confidence in Malaysia’s semiconductor ecosystem.

This aligns with Malaysia’s broader goal of becoming a regional design and innovation hub, bridging the gap between upstream chip design and downstream manufacturing.

IC Design Park 2: A New Hub for Chip Innovation

Building on the success of the first IC Design Park in Puchong, Selangor has launched IC Design Park 2 at Coplaze 9, Cyberjaya. The new phase addresses the growing demand from global semiconductor giants seeking to establish operations in Malaysia.

The new facility will feature:

• A world-class Advanced Chip Testing Centre, offering chip design emulation, prototype development, and device verification;
  
• The Advanced Semiconductor Academy of Malaysia (ASeM), focusing on talent development and workforce upskilling for high-tech roles.
  

Amirudin said these efforts would ensure that Malaysian engineers and professionals benefit directly from the nation’s expanding semiconductor ecosystem.

Linking Policy, Industry, and Innovation

To further integrate semiconductor growth into Malaysia’s digital economy, the Selangor government is implementing the Local Economy Development (LED) Policy.
The framework mandates 30% local content for all new data centre investments, ensuring that local companies, tech providers, and workers participate in digital infrastructure projects.

This policy works alongside Speed Selangor, a state-level initiative designed to fast-track approvals and accelerate infrastructure projects, making the region more attractive to high-value technology investors.

A Broader National Vision

Amirudin highlighted that initiatives led by ASeM, including the National Semiconductor Excellence Programme and Global Semiconductor Exchange Programme, are already helping Malaysia expand its role in the global semiconductor supply chain.

He noted that combining talent development, venture investment, and R&D infrastructure will be crucial in moving Malaysia up the value chain—from chip assembly and testing toward design, verification, and advanced engineering capabilities.

Analysis: Why This Matters

Malaysia’s semiconductor sector has historically been dominated by manufacturing and assembly, but global supply chain realignments are creating new opportunities for IC design and upstream innovation.
By coupling a dedicated fund (Ehsan Capital) with a physical innovation hub (IC Design Park 2), Selangor is signaling a shift toward value creation and design-led growth—a necessary move if Malaysia wants to compete with Taiwan, South Korea, and Singapore in the next phase of the chip economy.

The RM100 million fund may be modest compared to global standards, but it’s strategically positioned: early-stage, locally driven, and focused on bridging talent, capital, and technology.

Conclusion

With Ehsan Capital and IC Design Park 2, Selangor is positioning itself at the heart of Malaysia’s semiconductor transformation.
While the funding size may appear modest, its targeted impact on design innovation, startup development, and talent creation makes it a significant milestone in Malaysia’s broader journey toward a self-sustaining, innovation-led semiconductor industry.

If executed effectively, Selangor’s twin-pronged strategy—capital + capability—could make it the epicenter of Southeast Asia’s semiconductor design ecosystem over the coming decade.

Quick Takeaways

• RM100 million fund launched: Selangor’s Ehsan Capital will invest in at least seven local semiconductor startups.
  
• IC Design Park 2 debuts: New Cyberjaya facility to host advanced testing and talent training centers.
  
• Talent focus: The Advanced Semiconductor Academy will upskill local engineers for next-generation chip development.
  
• Policy synergy: The LED and Speed Selangor policies aim to ensure local participation and accelerate digital infrastructure projects.
  
• Strategic vision: Moves align with Malaysia’s NIMP 2030 to elevate the nation into the top 30 global economies by 2030.