Malaysia is shaking up the global semiconductor landscape, taking bold steps to pivot away from its traditional reliance on the United States and forging new partnerships with BRICS nations like Brazil and India. This move, announced in October 2025, marks a dramatic recalibration of Malaysia’s economic and diplomatic strategy, as the country seeks to secure its semiconductor future amid growing US protectionism and a rapidly evolving global order.
For decades, Malaysia has been a linchpin in the world’s semiconductor supply chain. While it may not design the world’s most advanced chips like Taiwan or South Korea, its assembly, testing, and packaging (ATP) industry is essential to the functioning of everything from smartphones to electric vehicles. According to News18, chips account for nearly 60 percent of Malaysia’s annual electrical and electronics exports, making the country the sixth-largest semiconductor exporter globally. That’s no small feat for a nation of 33 million people.
But the ground has started to shift beneath Malaysia’s feet. The United States, historically the largest market for Malaysian electronics, has been raising tariff walls, imposing duties between 10 and 40 percent on Asian goods. In 2024 alone, ASEAN nations exported $352.1 billion worth of goods to the US—a figure now under threat as Washington’s economic nationalism takes hold. Deputy Trade Minister Liew Chin Tong told the Malaysian Parliament that the country’s reliance on US exports “may one day end,” a statement that signals just how seriously Kuala Lumpur is rethinking its alliances.
“The US now does not want to import much from our country and ASEAN nations,” Liew bluntly stated, reflecting a growing frustration among Southeast Asian exporters, as reported by News18. The US’s shift toward so-called “friend-shoring”—restructuring supply chains to favor domestic or allied producers—has left Malaysia and its peers scrambling to diversify their markets and reduce vulnerability to American policy swings.
Enter the BRICS nations. The grouping—Brazil, Russia, India, China, and South Africa—now accounts for nearly 40 percent of global output and is increasingly seen as a parallel platform for global trade, development finance, and technological cooperation. Malaysia’s recent moves to negotiate a memorandum of cooperation with Brazil for semiconductor development, and to pursue a similar agreement with India, are more than just trade diversification. They represent a strategic bet on the future of the global economy.
Brazil, as Latin America’s largest economy and a key BRICS player, brings to the table both raw materials and a huge consumer market. India, meanwhile, offers a vast pool of human capital and technical expertise in chip design, integrated circuits, and software engineering. By collaborating with these countries, Malaysia hopes to reshape its role in the semiconductor ecosystem—not merely as a supplier to Western firms, but as an active co-creator of new supply routes, technologies, and market structures.
This trilateral cooperation could have far-reaching consequences. Malaysia’s Prime Minister Anwar Ibrahim has been vocal about his support for a multipolar global order. By deepening ties with the BRICS bloc, he’s positioning Malaysia as a bridge between ASEAN and the wider Global South—a role that could attract new investment, foster joint ventures, and spur research collaborations in semiconductors, green technology, and AI-driven manufacturing.
Of course, this pivot doesn’t come without risks. Closer alignment with BRICS-aligned nations could expose Malaysia to fresh geopolitical headwinds, especially as the global chip race heats up amid US-China rivalry. But for Kuala Lumpur, the alternative—remaining tethered to an increasingly unpredictable and protectionist US—seems even riskier. As News18 points out, the country’s semiconductor diplomacy could become a blueprint for other ASEAN economies seeking to thrive in a world where chips, not oil, are the new currency of power.
The timing of Malaysia’s outreach is significant. President Donald Trump is expected to visit Kuala Lumpur for the upcoming ASEAN Summit, where he will meet with leaders from both ASEAN and BRICS nations, including Chinese Premier Li Qiang, Indian Prime Minister Narendra Modi, Brazilian President Luiz Inácio Lula da Silva, and South African President Cyril Ramaphosa. The summit could prove a litmus test for the future of US-ASEAN relations—and for the broader direction of global trade.
Meanwhile, India is making its own moves to assert leadership on the world stage. On October 15, 2025, Union Minister of Textiles, Commerce and Industry Piyush Goyal delivered the keynote address at the 7th Indian Chemicals and Petrochemicals Conference in New Delhi, as reported by Business Standard. Goyal emphasized that India’s chemicals and petrochemicals sector has the potential to be at the forefront of developing new technologies, positioning the country as a global leader in cutting-edge solutions for the economy and industry.
“The chemical and petrochemical industry has the potential to lead in developing new technologies and position India as a global leader in providing cutting-edge solutions,” Goyal stated. He highlighted the sector’s strategic importance across agriculture, healthcare, infrastructure, construction, energy, and mobility, noting that its products and services touch almost every aspect of the manufacturing and consumption ecosystem.
Goyal urged industry leaders to identify competitive advantages and increase India’s share in global exports, moving beyond its current modest contributions. He pointed out that even oil-rich nations are investing in value-added products, clean energy, renewable energy, and climate change-related technologies—a global shift toward innovation-driven growth that India must not ignore.
The Indian government, Goyal explained, is focused on negotiating free trade agreements with countries and regions such as Mauritius, the UAE, Australia, Liechtenstein, Norway, Iceland, Switzerland, and the United Kingdom. These trade deals are designed to open up markets for Indian products, attract technology and investment, and foster collaboration in innovation-driven sectors, all while ensuring that domestic industries are shielded from undue risk.
“The world economy experiences fluctuations, but the need to address climate change and advance technologically remains constant,” Goyal observed, underscoring the importance of resilience and adaptability in the face of global uncertainty.
Both Malaysia and India, then, are navigating a world in flux. Malaysia’s pivot to BRICS and India’s push for global leadership in chemicals and technology are emblematic of a broader trend: the rise of the Global South as a force to be reckoned with in international trade and innovation. As US leverage wanes and new corridors of commerce open between São Paulo, New Delhi, and Kuala Lumpur, the rules of the game are being rewritten—and the future of the global chip race may well be decided far from Washington’s corridors of power.
In this new era, the ability to adapt, collaborate, and innovate will determine which nations thrive. Malaysia and India, by seeking new alliances and embracing technological change, are betting that the future belongs to those willing to chart their own course.
