Intel CEO Meets Penang CM, Signalling New Phase of Semiconductor
Leadership
Telecom Sector Faces Ongoing Cyber Attacks As 2026 Begins: Kaspersky
Malaysia’s Tech Sector Set to Ride AI, Data Centre Boom Into 2026
COVER STORY
Driving Sustainable Innovation in the Semiconductor Industry through Integrated Technologies
Shinichi Sakai, Managing Director, Hitachi Asia Ltd.
As we move further into 2026, Malaysia’s manufacturing sector continues to accelerate its shift towards smart manufacturing. Under the National Industrial Master Plan 2030, more companies are progressing beyond standalone automation projects and working towards fully connected, data-driven operations. The focus today is not merely on upgrading equipment, but on integrating systems across the factory floor — linking real-time data, analytics and decision-making to enhance efficiency, minimise downtime and remain competitive in an increasingly demanding global market.
Johor, in particular, is emerging as a strong example of this transformation. With its expanding industrial ecosystem and strategic position within the Johor-Singapore economic corridor, manufacturers are scaling digital initiatives across entire operations rather than limiting them to pilot phases. This growing momentum will also be reflected at Johor Industrial Fair 2026, where industry leaders and solution providers will gather to exchange insights and explore advanced technologies shaping the region. For more information about the upcoming fair, visit www.johorexpo.com.
As always, we remain committed to bringing you meaningful conversations from the factory floor and the broader industrial landscape. Thank you for your continued support of Automate Asia Magazine. Your readership and engagement allow us to keep highlighting the real challenges, practical solutions and industry voices driving manufacturing forward across Malaysia and Southeast Asia.
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08. Intel CEO Meets Penang CM, Signalling New Phase of Semiconductor Leadership
10. DHL Opens Second Logistics Hub in Senai Airport City as Johor Demand Accelerates
12. Malaysia, Thailand Expand TVET Collaboration to Strengthen Highly Skilled Workforce
13. Strong Industrial Base Driving Penang’s Rise in Renewable Energy
14. China’s CCTech Unit Exis Tech Opens Second Plant in Negeri Sembilan
15. South Korea to Consider Setting Up US$3.1bil Foundry to Grow Local Chip Sector
16. China’s Smaller Manufacturers Look to Catch the Automation Wave
18. Changi Airport Deploys Driverless Tractors for Baggage Transfer After Successful Trials
20. How Agility Robotics Uses Artificial Intelligence, From Their Humanoid ‘Digit’ To Everyday Workflow
23. Robotic Tech Boosts USM Medical Training
24. Singapore Researchers Develop World’s First Robotic Chaperone to Support Seniors with Mobility Issues
26. Malaysia’s Tech Sector Set to Ride AI, Data Centre Boom Into 2026
30. Microsoft Unveils US$23bil In New AI wInvestments with Big Focus on India
32. MPC: Firms That Adopt AI Boost Productivity by Up To 80pc, Cut Costs By 60pct
34. What Clients Value Most Is the One Thing AI Cannot Produce
36. Enhancing Veterinary Education with VR And AI
37. U Mobile, IGB Team Up to Deploy Next-Gen 5G Across 20 Key Properties
38. Could 5G Unlock a New Era of Smarter, Faster Robotics and Drones in Malaysia?
40. Telecom Sector Faces Ongoing Cyber Attacks As 2026 Begins: Kaspersky
42. Driving Sustainable Innovation in the Semiconductor Industry through Integrated Technologies: Shinichi Sakai, Managing Director, Hitachi Asia Ltd.
48. Execution Intelligence How Physical AI Is Reshaping ASEAN’s Supply Chains
50. From Automation Islands to Industrial Capability Why Malaysia’s M&E Sector Must Move Beyond Tools to Systems
54. Industrial Maturity is Built, Not Installed Complexity Absorption Capacity and the Next Phase of ASEAN Manufacturing
58. Understanding Taiwan’s Standing in The Global AI Supply Chain Today
62. Automate Asia at Asia Photonics Expo 2026: Precision, Partnerships and Practical Innovation
Penang’s status as a global semiconductor hub received a boost today when Intel Corporation chief executive officer Tan Lip-Bu held a highlevel meeting with Chief Minister Chow Kon Yeow.
The discussion marked a key step in the state’s transition toward advanced packaging and next-generation semiconductor technologies.
For more than 50 years, Intel’s presence in Penang has been a cornerstone of Malaysia’s rise as a world-class semiconductor hub.
During the meeting, Chow expressed deep appreciation for Intel’s longstanding commitment, crediting the tech giant for cultivating a world-renowned engineering ecosystem, a robust supply chain and generations of homegrown talent.
“Intel’s investments and trust in Penang have shaped the trajectory of our industry and our people,” Chow said, acknowledging the company’s role in accelerating Malaysia’s competitiveness on the global stage.
The session also included a presentation by InvestPenang, highlighting new
opportunities for strategic collaboration.
With Penang striving to position itself at the forefront of advanced packaging, IC design and other highvalue semiconductor activities, the state is seeking continued partnership with Intel to strengthen its industrial transformation.
Tan reaffirmed Intel’s alignment with both Penang’s ambitions and Malaysia’s National Semiconductor Strategy (NSS), describing the policy as a catalyst for elevating the country’s role in the global chip supply chain.
He emphasised shared priorities in talent development, R&D expansion and supply chain resilience.
One of the meeting’s key milestones was Intel’s update on its advanced packaging plant in Penang — a flagship investment valued at RM12 billion.
The facility, now 99 per cent complete, represents one of the company’s most significant commitments in the region and is poised to enhance Malaysia’s capabilities in cutting-edge chip manufacturing technologies.
Intel leaders expressed appreciation for the Penang government’s consistent support, crediting close public–private collaboration as a major factor in the project’s rapid progress.
Also present were vice president of foundry manufacturing and supply chain, and Intel Malaysia managing director AK Chong, and vice president of design engineering and Malaysia Design Centre general manager Suresh Kumar Dass, alongside InvestPenang chief executive officer Datuk Loo Lee Lian and officers from both organisations.
As Penang continues its journey into the next era of semiconductor innovation, today’s meeting signals a deepening partnership between the state and one of its most influential technology anchors — one that is likely to shape Malaysia’s global semiconductor footprint for decades to come.
DHL Supply Chain Malaysia has commenced operations at its second logistics facility in Senai Airport City since Jan 20.
The new Malaysia South Region Hub 2, located within the Senai Airport City Free Zone, marked DHL’s second major logistics investment in Johor.
This follows the opening of South Region Hub 1 in April last year, which has since reached full occupancy by multinational high-technology companies.
DHL said the latest facility, completed within a year of its last April groundbreaking, expanded its capacity to support advanced manufacturing and technology-driven supply chains operating in southern Malaysia and the wider region.
Spanning 18,660 square metres, the hub is fully occupied by key investors within Senai Airport City, to fulfil strong demand for integrated logistics infrastructure as companies seek proximity to air, sea and land transport networks.
South Region Hub 1 houses DHL’s regional control tower, that provides centralised coordination, real-time end-to-end visibility and multi-country supply chain monitoring across Malaysia, Singapore and Thailand.
DHL said Hub 2 incorporated sustainability features including solar panels, smart LED lighting and rainwater harvesting systems, in line with the group’s global sustainability commitments and Senai Airport City’s low-carbon development objectives.
The opening ceremony was attended by DHL Supply Chain Southeast Asia chief executive officer Edwin Wong, DHL Supply Chain Malaysia managing director Mario Lorenz, Senai Airport City representatives and major investors operating within the zone.
The sequential development of DHL’s two hubs reflected the multiplier effect of Senai Airport City’s integrated industrial ecosystem, which continues to attract logistics-led investments and strengthen Johor’s position as a key gateway for regional trade.
Malaysia and Thailand are exploring the potential to expand cooperation in Technical and Vocational Education and Training (TVET) to strengthen the technical and highly skilled workforce of both countries.
Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi said TVET cooperation, particularly in the field of agriculture, can increase employment opportunities, strengthen human capital development, and support economic growth in both countries.
The rural and regional development minister and National TVET Council chairman said this to Bernama after paying a courtesy call on the Thai Prime Minister Anutin Charnvirakul at the Government House today.
He said, in addition to the agricultural sector, skills training in manufacturing, digital technology, as well as student and lecturer mobility programmes are also being prioritised in this collaboration.
“TVET fields are important for equipping rural youth with relevant technical skills to face the Fourth Industrial Revolution (4IR),” he said.
He added that one of the pilot programmes that will be the starting point for TVET cooperation between the two countries is the “training for trainers” programme.
Meanwhile, Zahid said, in his meeting with Anutin, the two leaders also agreed to strengthen cooperation in the halal industry, including the development of the halal value chain, investment in halal products, and joint export opportunities.
“Malaysia welcomes Thailand’s interest in exploring the halal sector more comprehensively, given the growing global demand,” he said.
Earlier, Zahid, who is on a three-day working visit to Thailand, also paid a courtesy call on the president of the National Assembly and speaker of the House of Representatives of Thailand, Wan Muhamad Noor Matha.
In 2024, Thailand was Malaysia’s seventh largest trading partner globally and the third largest among Asean member states, with total trade amounting to RM114.56 billion (US$25.03 billion).
From January to October 2025, total bilateral trade reached RM98.19 billion, compared to RM95.52 billion during the same period in 2024.
Penang is on track to become one of Malaysia’s leading states in renewable energy adoption, particularly in solar power, driven by its robust industrial base and rising sustainability awareness.
The Malaysian Photovoltaic and Sustainable Energy Industry Association (MPSEA) said Penang has recorded steady progress in rooftop solar deployment, especially across factories and commercial buildings, with adoption rates among the highest in the country when measured against land size.
“While Penang’s total installed capacity is smaller compared to Selangor and Johor, its penetration rate is relatively high. Interest among small and medium enterprises (SMEs) and households continues to grow steadily,” the association said in a note to Bernama.
It said Penang’s manufacturing and tourism sectors offer strong potential for wider solar adoption, given their high energy demand and the opportunity to strengthen eco-branding through renewable energy integration.
However, MPSEA noted that limited land availability and grid capacity constraints remain key challenges that could affect the pace of large-scale renewable energy deployment.
According to the association, its members are actively involved in rooftop solar projects within the Penang Free Industrial Zone (FIZ) and other commercial areas, and are anticipating new frameworks under the upcoming Advanced Transition Access Programme (ATAP) following the conclusion of the Net Energy Metering (NEM) scheme.
“Collaborations are also underway with state-linked developers on green industrial park initiatives that integrate renewable energy as part of sustainable zone planning,” it said.
The association added that wider adoption of solar energy would help Penang businesses manage rising operational costs, improve compliance with international sustainability standards such as the EU Carbon Border Adjustment Mechanism (CBAM) and enhance corporate branding.
Penang is on track to become one of Malaysia’s leading states in renewable energy adoption, particularly in solar power, driven by its robust industrial base and rising sustainability awareness.
It said cost savings from renewable energy could be channelled into research, technology upgrades and business expansion, thus supporting long-term growth.
On manpower readiness, MPSEA said Penang benefits from a strong pool of engineering and electronics talent, supported by expanding Technical and Vocational Education and Training (TVET) programmes focused on renewable energy.
However, it said there is a need for more specialised installers and operations-andmaintenance professionals, especially as project scale increases.
Looking ahead, MPSEA expects rooftop solar adoption in Penang to accelerate over the next five years, with more hybrid systems integrating energy storage as costs decline.
“The development of green industrial parks and renewable-energy-ready infrastructure will continue to attract investment, solidifying Penang’s position as a key player in Malaysia’s energy transition,” the association added.
Exis Tech Sdn Bhd, a semiconductor equipment manufacturer under China’s Hangzhou Changchuan Technology Co Ltd (CCTech), has begun operations at its second manufacturing facility in Senawang, Negri Sembilan.
The new Phase 1 facility, backed by an investment of about RM25 million, doubles the company’s existing production floor space.
Phase 2 construction is expected to start in early 2026 and conclude by late 2027, involving more than RM100 million in additional investment.
Once fully completed, the enlarged site will be six times the size of Phase 1 and is expected to generate 600 to 800 skilled jobs over the next two to five years, along with 50 new hires to reinforce the company’s global customer service network.
MIDA chief executive officer Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid said Exis Tech’s expansion strengthens Malaysia’s semiconductor ecosystem and reinforces the country’s role in the global value chain.
He added that the establishment of advanced integrated circuit equipment and chip-testing operations in Negri Sembilan enhances national industrial capabilities and supports import substitution in critical technologies.
“Most importantly, this investment delivers real impact to the rakyat through the creation of high-quality
jobs, accelerated skills development, and the strengthening of our national semiconductor talent pool,” he said in a statement.
CCTech chairman Zhao Yi said the group’s decision to invest in Malaysia is a testament to the country’s progressive policies focusing on the semiconductor industry and also the abundance of highly skilled workforce.
He said as semiconductor technology continues to evolve, the associated manufacturing challenges have grown even more complex, requiring new methods, materials and machinery.
“CCTech is committing half its 5,000-strong global workforce to research and development efforts, in order to overcome these challenges and provide our customers with the most cost-effective solutions.”
“We are very excited to witness the launch of Phase 1 and we look forward to bringing even more products and manufacturing expertise to Malaysia. We hope this will spur greater innovation and propel CCTech to even greater heights in the near future,” he added.
With the new facility, Exis Tech will serve as CCTech Group’s principal manufacturing and export base for markets outside of China.
The expansion will broaden its local production portfolio, including the integration of automated optical inspection machines from fellow CCTech subsidiary Singapore Technologies and Instruments Co Ltd, further positioning Malaysia as a key node in the group’s global manufacturing and export strategy.
South Korea is considering building a 4.5 trillion won (US$3.06 billion) foundry to manufacture chips, funded by state and private investment, the industry ministry said, amid efforts to ensure the country remains a powerhouse in semiconductors.
President Lee Jae Myung presided over a meeting on Wednesday attended by executives from chipmakers, including Samsung Electronics and SK Hynix, as well as policymakers and experts to lay out plans to maintain the country’s lead in memory chips, strengthen the foundry business and expand fabless chip design in the AI era.
“South Korea needs to take a new leap forward, and... the semiconductor sector is an area where we are very competitive,” Lee said.
South Korea will consider setting up a 12-inch, 40-nanometre foundry jointly backed by the public and private sectors to help fabless firms develop and test chips, the industry ministry said in a statement.
South Korea will also seek to locally produce defence-related semiconductors, given that the sector relies on imports for 99 per cent of its supplies, the ministry said.
The government will consider putting in a provision for the priority purchase
of domestic semiconductors in national security infrastructure in a related law, it said.
A special committee on semiconductors will be established under President Lee to act as the control centre for national policies on chips, the statement said.
South Korea is considering building a 4.5 trillion won (US$3.06 billion) foundry to manufacture chips, funded by state and private investment. AFP pic
In a light-filled workshop in eastern China, a robotic arm moved a partially assembled autonomous vehicle as workers calibrated its cameras, typical of the incremental automation being adopted even across smaller factories in the world’s manufacturing powerhouse.
In a light-filled workshop in eastern China, a robotic arm moved a partially assembled autonomous vehicle as workers calibrated its cameras, typical of the incremental automation being adopted even across smaller factories in the world’s manufacturing powerhouse.
China is already the world’s largest market for industrial robots, and the government is pouring billions of dollars into robotics and artificial intelligence to boost its presence in the sector.
The first essentially humanless factories are already in operation, even as widespread automation raises questions about job losses as well as the cost and difficulty of transition for smaller and medium-sized companies.
The answer for many is a hybrid approach, experts and factory owners told AFP.
At the autonomous vehicle workshop, manager Liu Jingyao told AFP that humans are still a crucial part of even technologically advanced manufacturing.
“Many decisions require human judgement,” said Liu, whose company Neolix produces small van-like vehicles that transport parcels across Chinese cities.
“These decisions involve certain skillbased elements that still need to be handled by people.”
At the Neolix factory, 300 kilometres (186 miles) north of Shanghai, newly built driverless vehicles zoomed around a testing track simulating obstacles including puddles and bridges.
In a closed-off room, workers assembled vehicles’ “brains”, testing their cameras and computer chips.
“Automation... primarily serve(s) to assist humans, reducing labour intensity rather than replacing them,” Liu said.
But Ni Jun, a mechanical engineering expert at Shanghai’s Jiaotong University, said China’s strategy of focusing on industrial applications for AI means full automation is already feasible in many sectors.
Among others, tech giant Xiaomi operates a “dark factory” -- where the absence of people means no need for lights -- with robotic arms and sensors able to make smartphones without humans.
Ni described a “digital divide” between larger companies with the funds to invest heavily in modernisation, and smaller businesses struggling to keep up.
For Zhu Yefeng’s Far East Precision Printing Company, part of China’s vast network of small independent factories employing up to a few dozen people each, full automation is a distant dream.
At the company just outside Shanghai, workers in small rooms fed sheets of instruction manuals into folding machines and operated equipment that printed labels for electronic devices.
The company used pen and paper to track its workflow until two years ago, with managers having to run around the factory to communicate order information.
“Things were, to put it bluntly, a complete mess,” Zhu told AFP.
The company has since adopted software that allows employees to scan QR codes that send updates to a factory-wide tracker.
On a screen in his office, Zhu can see detailed charts breaking down each
order’s completion level and individual employees’ productivity statistics.
“This is a start,” Zhu told AFP. “We will move toward more advanced technology like automation, in order to receive even bigger orders from clients.”
Financial constraints are a major barrier though.
“As a small company, we can’t afford certain expenses,” said Zhu.
His team is trying to develop its own robotic quality testing machine, but for now humans continue to check final products.
The potential unemployment caused by widespread automation will be a challenge, said Jacob Gunter from the Berlin-based Mercator Institute for China Studies.
“Companies will be quite happy to decrease their headcount... but the government will not like that and will be under a lot of pressure to navigate this,” Gunter told AFP.
Beijing’s push to develop industrial robots will “intersect with the need for maintaining high employment at a time when employment pressure is considerable”, he added.
Going forward, manufacturers must strike a balance “between the technical feasibility, social responsibility, and business necessity”, Jiaotong University’s Ni told AFP.
Zhou Yuxiang, the CEO of Black Lake Technologies -- the start-up that provided the software for Zhu’s factory -- told AFP he thought factories would “always be hybrid”.
“If you ask every owner of a factory, is a dark factory the goal? No, that’s just a superficial description,” Zhou said.
“The goal for factories is to optimise production, deliver things that their end customers want, and also make money.”
Changi Airport has deployed its first fleet of fully driverless tractors for airside operations after nearly a year of trials.
Two autonomous tractors have been rolled out in live operations to transfer passenger bags between Terminal 1’s and Terminal 4’s baggage handling areas, Changi Airport Group (CAG) said on Tuesday (Jan 20).
The project, co-funded by the Civil Aviation Authority of Singapore (CAAS), aligns with Changi Airport’s broader innovation strategy, the group noted.
This strategy includes the integration of autonomous technology into airside operations, the use of AI in initiatives, as well as automation and robotics to increase manpower productivity, it said.
“The milestone marks a significant leap in Changi Airport’s push for innovation
and operational efficiency, raising manpower productivity while enhancing safety and reliability,” CAG added.
Each autonomous tractor has more than 10 sensors and cameras to enable the vehicles to safely navigate the airside environment in all conditions.
The tractors are also monitored in a control centre where a remote operator can step in immediately if human intervention is required.
The autonomous fleet will free up airside workers from driving tasks and let them focus on last-mile operations, which are more difficult to automate, CAG said.
“Through collaborating with our airport partners to redesign work processes and infrastructural policies, we are shaping a future-proofed working environment where autonomous vehicles can function safely and seamlessly with other humandriven vehicles, with workers focusing on last-mile operations,” said CAG’s senior vice president of airport operations strategy and transformation Liu Yanling.
To ensure the tractors operate safely alongside workers, clear autonomous vehicle (AV) zone markings have been painted in the airside, with clear labels also attached to all AVs.
Later this year, another six autonomous tractors will be deployed to a different route between Terminal 2’s baggage handling area and aircraft stands to support baggage operations under a CAG-SATS collaboration.
The collaboration will translate into “more reliable baggage handling and smoother aircraft turnarounds, supporting on-time departures and a seamless airport experience”, said SATS Apron Services senior vice president Kuah Boon Kiam.
By 2027, the driverless fleet will be expanded to 24 vehicles, with more autonomous tractors deployed to tow cargo and equipment, in addition to baggage, CAG said.
“As Changi scales up to meet the operational requirements of Terminal 5 by the mid-2030s, such innovations will enable CAG and its partners to redesign and upgrade the job scopes of airside workers, to improve their productivity,” the group said.
“Such productivity improvements and upgrading of airside roles are critical to grow the Singapore air hub to meet the future demands of air travel.”
In July last year, CAAS’ aviation jobs transformation report indicated that up to 30 per cent of the existing workforce could experience job redesign and transformation over the next five years, with the majority of them in the ground handling sector.
“The scaled deployment of autonomous tractors allows CAAS, CAG, SATS and
our unions to work together to implement the technology, develop new systems and protocols, and set up job redesign programmes to help our workers adopt technology and transition to higher-value work,” said CAAS’ director of aviation industry Angela Ng.
“Lessons learnt here will be useful for the sector’s wider technology adoption and job transformation efforts.”
Digit the humanoid robot is 5 feet 9 inches (175cm) tall and lives in warehouses, helping its human coworkers move and stack boxes up to 35 pounds (15.87kg). It also “smiles” and waves.
Robots like Digit are a growing pursuit among robotics companies that are trying to bring humanoids into everyday life, and specifically into the home as helpers. A crucial part of that equation is using artificial intelligence to help the robot observe, interpret and respond to its surroundings in real time, without human intervention.
But your dishwasher is also a robot and one that works quite well, said Pras Velagapudi, chief technology officer at Agility Robotics, the maker of Digit. And, most important, it’s proven safe in the home.
Currently, Digit is working with Amazon to help move products in warehouses. — Business Wire/TNS
While humanoid robots may not be folding your laundry and doing your dishes anytime soon, companies including Salem, Ore.-based Agility have a longterm goal to put robots wherever they can be in the world.
“We want to be producing a humanoid robot that can solve all of those disparate types of labor problems that are out there in the world,” Mr Velagapudi said. “We would love to have Digit take on all of the manual labor that people don’t want to.”
But Digit, for now, is for industrial use.
“We just have a plan to get there that involves starting with the most obvious, short-term places where we can put Digit right now,” he said.
Velagapudi has worked with many different robots across two decades including 10 years at Carnegie Mellon University. For him, one observation has held true.
“Robots have to serve purposes,” he said. “They can’t just exist in the world for the sake of existing in the world. They have to be able to do useful work to prove themselves, at least at scale.”
Although Agility builds humanoids –which are an “extremely powerful” form –he warned against the notion that humanshaped is the only, or best, kind of robot configuration.
“There’s great robot arms that are welding cars together. There’s conveyance systems that can store and retrieve boxes,”
Velagapudi said. “Your dishwasher is a robot. It works great. You wouldn’t necessarily want to replace your dishwasher with a humanoid standing over the sink.”
Currently, Digit is working with Amazon to help move products in warehouses.
On Wednesday, Agility announced a partnership with Mercado Libre, “the leading company in e-commerce and financial technology in Latin America” headquartered in Montevideo, Uruguay. Digit will help with fulfillment operations at Mercado Libre’s facility in San Antonio.
Robotics and artificial intelligence grew up together, often informing each other’s growth. Today, AI is helping accelerate robotics, and robotics gives AI a “body” to experience the world.
But that began in the 1960s with Shakey the Robot, “the first mobile robot with the ability to perceive and reason about its surroundings,” according to its
genesis institution, the Stanford Research Institute. Shakey had a camera and optical rangefinder to “see,” as well as bump detectors, a radio antenna and push bars to move things.
“Historically, a lot of robotics techniques are AI techniques. They’re indistinguishable,” Velagapudi said. “They were the same things from day one.”
“More recently – and when I’m talking more recently, I mean decades – AI’s become its own thing as it’s been adapted to serve these different needs outside of just the robotics and pure computer science space.”
That more “modern” AI, he said, is crucial to Digit – for operating controls, learning skills, keeping balance, perceiving objects in the world, “areas where the robot can’t necessarily be completely exactly told what the answer is,” he said.
You can’t write an equation for everything, he said.
Agility’s team also uses AI, such as Google and Nvidia products, in their everyday workflows, “like any fast-paced business out there right now,” Velagapudi said. The tools have gotten “quite good and quite affordable” he said, and AI acts as a huge multiplier to the team, helping offload documentation and program management.
AI also augments Agility’s coding process as a kind of “coach,” which is significant given that half of the engineering team is in software development, while the other is in hardware.
But ultimately, he said the engineers are fully responsible for the code they write, whether they choose to use AI or not.
Digit was a hit at the Pittsburgh Robotics Network’s Robotics and AI Discovery Day, which was held at the David L. Lawrence Convention Center in November.
A blue and silver humanoid, Digit garnered much attention at the convention in the “Robotics” zone, where people fawned over the bot. Digit smiled back with its pixelated eyes, and waved at its audience. But Digit was still kept behind crowd-control stanchions, away from direct contact with visitors.
Although robots far more dangerous than humanoids have been a part of manufacturing and industry for some time now, the safety around humanoids is a new, developing science – and a “much, much, much harder challenge that AI on its own doesn’t immediately solve,” Velagapudi said. It will be some time before humanoids are proven safe in the home.
“How do you add something that is potentially hazardous into your environment safely? That’s why I think we can see adoption of humanoids in those sectors, in warehouse and logistics and manufacturing, because we’ve kind of started that work way back in the ‘60s
when the first robot arms were coming into the space,” he said.
But the fact that humanoid robots can enter the world around them without necessarily changing its infrastructure is an exciting new frontier, he said.
“My favourite part about all of this is we’re truly at a point where we can build machines that go out in the world and affect it in ways that are very similar, on par, to what humans can do. That’s so exciting,” Velagapudi said.
“That’s never been the case before. It’s never been the case that you could take a robot out into the world and easily have it do something like play cornhole, or move around the same objects that you move around without having to modify the environment, without having to put rails on it or put special tags on it.”
Hospital Pakar Universiti Sains Malaysia (HPUSM) is now offering training in robotic technology for knee surgery as part of efforts to advance medical practice in line with current technological advancements.
Universiti Sains Malaysia (USM) vice-chancellor Prof Datuk Seri Dr Abdul Rahman Mohamed said robotic technology is part of the components of the Master of Medicine (Orthopaedics) programme.
He said that through the training, postgraduate students are exposed to high-precision surgical practices and datadriven pre-operative planning, as well as objective intraoperative assessment.
“HPUSM is also among the main training centres for orthopaedic specialists in Malaysia.
“It also offers the Arthroplasty Fellowship Programme for advanced training in joint replacement surgery,” he told the media, which included Bernama, after launching the Robotic Total Knee Replacement Surgery Service at Dewan Utama Kampus Kesihatan USM in Kubang Kerian, here yesterday.
Elaborating further, he said the training is conducted by three instructors: Prof Dr Amran Ahmed Shokri, Dr Muhammad Rajaei Ahmad Mohd Zain, and Assoc Prof Dr Shaifuzain Ab Rahman.
“So far, about 80 postgraduate students have enrolled in the programme, in line with HPUSM’s commitment as an academic hospital to train more specialists, particularly in robotic surgery,” he said.
In a related development, Abdul Rahman said HPUSM also offers robotic total knee replacement surgery using the Rosa Knee System, which functions as a surgical assistant.
He said the first procedure was successfully performed on Sept 23 last year, and to date, 13 patients have undergone surgery using the system, with early clinical outcomes showing encouraging progress.
“The introduction of this service enables patients on the east coast to gain access to high-technology knee surgeries that improve their quality of life through better knee function restoration,” he said.
Developers hope the robot can boost seniors’ rehabilitation and independence as Singapore moves towards becoming a super-aged society.
Mr Leow Cher Hwa never thought something as simple as walking would become a daily struggle.
The 66-year-old suffered a stroke in 2022 that left him half-paralysed. He spent two months in hospital, grappling not just with physical challenges but emotional ones as well.
“I was very pessimistic and depressed. I took it very hard for the first two months,” he recounted.
But things began to change for the better from August last year, when he was chosen to take part in a trial involving a new rehabilitation robot at the Lions Befrienders’ Active Ageing Centre in Tampines.
Billed as the first of its kind in the world, the Data-driven Robotic Balance Assistant (DRBA) is designed to help seniors with mobility challenges by catching them before they fall.
Using inbuilt sensors and artificial intelligence, the robot can instantly detect a loss of balance and support the user, potentially preventing serious injuries.
It was rolled out during a Zumba class with Mr Leow and fellow seniors on Wednesday (Jan 21), which was attended by Tampines Member of Parliament Charlene Chen.
As Singapore moves towards becoming a super-aged society, the robot’s developers hope the robot can be rolled out through community care groups to support rehabilitation and help seniors stay independent.
For users like Mr Leow, the DBRA has been a confidence booster. Strapped securely to the device, he is now able to take part in standing activities and even dance with peace of mind.
For community care providers, the benefits go beyond safety.
“DRBA allows them to come off from the machines or their motorised wheelchair, to be able to stand up and join in the standing activities. Otherwise, they’re only confined to chair Zumba and anything seated down, which means that it further weakens the leg muscles,” said Ms Karen Wee, executive director of Lions Befrienders.
However, affordability remains a major challenge.
The robot is estimated to retail at around S$90,000 (US$70,000), putting it out of reach for most individuals and community groups.
To address this, the team behind it - led by researchers from Nanyang Technological University - is exploring a rental model for community health organisations.
“It has to be a price that the seniors are willing to pay, so we’re targeting maybe S$30 to S$40 out of pocket for them. But that’s not the real cost,” noted Associate Professor Ang Wei Tech, director of the university’s Robotics Research Centre, who invented the DRBA.
“The real cost should be between S$150 and S$200 per session, so that difference has to come from somewhere. Is it a government subsidy? Is it philanthropist money? That, we need to explore.”
He added that discussions with government agencies could follow once the current trial concludes.
“We shall see which is the best channel for us to propose this plan to the government. We know that there’s a lot of funding to allow the seniors to get active … Hopefully, we can have some success in lobbying for the government to support this effort,” Assoc Prof Ang said.
The team is also in the process of applying for regulatory approval.
Assoc Prof Ang said the team is looking to get the Health Sciences Authority’s nod by June, after which they can sell the DBRA in Singapore.
Looking ahead, researchers plan to develop a smaller version of the robot for home use later this year, potentially extending its benefits beyond community centres and into seniors’ homes.
Malaysia’s technology (tech) sector continued its strong momentum in 2025, powered by rapid advances in
in data centre investments, amid intensifying strategic competition between the
Malaysia’s technology (tech) sector continued its strong momentum in 2025, powered by rapid advances in artificial intelligence (AI) and a boom in data centre investments, amid intensifying strategic competition between the United States and China.
This year, Malaysia remains an attractive alternative for multinational technology investors, with Penang and Johor standing out as the country’s primary tech hubs.
Penang, dubbed as Malaysia’s Silicon Valley, continued to lure semiconductor and high-value electronics manufacturers, supported by its robust supply chain and skilled talent pool.
Johor, meanwhile, cemented its position as a rising data centre cluster and strategic extension of Singapore’s digital infrastructure spillover, drawing billions in cloud, AI, and hyperscale investments.
Government incentives, public-private collaborations and growing confidence among global tech companies have reinforced the country’s place on the regional technology map.
The sector’s growth is further supported by government initiatives under the Malaysia Digital Economy Blueprint (MyDIGITAL) and by stronger foreign investment in data centres and cloud computing.
Prime Minister Datuk Seri Anwar Ibrahim stated that companies benefit from tax incentives and research and development support, encouraging the development of local talent and collaboration across industries to boost technological advancements and operational efficiency.
In the first half of 2025 (1H 2025), approved investments in the AI sector reached RM13.29 billion.
The data centre and cloud vertical were the leading area of investment under the Malaysia Digital initiative, contributing RM30.95 billion to total digital investments.
According to the Malaysian Investment Development Authority (MIDA), Malaysia continued to chart a resilient course in the 1H 2025, recording RM190.3 billion in approved investments across the services, manufacturing, and primary sectors, an 18.7 per cent increase compared to the same period last year.
In the 1H 2025, RM88.3 billion or 46.4 per cent of approved investments were aligned with the National Investment Aspirations’ (NIA) priority sectors, namely advanced technology, digitalisation, green growth, and inclusivity.
A total of 143 data centre investment projects have been approved between 2021 and June 30, 2025, including 25 projects with Malaysia Digital status under the Digital Ecosystem Acceleration Scheme incentive, with total investments worth RM144.4 billion and the creation of 1,429 new jobs.
Furthermore, major global tech players have announced substantial investments in Malaysia, particularly in data centres and AI infrastructure, including commitments from Microsoft, Google and Amazon Web Services (AWS).
On July 29, YTL Power International and Nvidia Corp signed an agreement to develop US$2.36 billion (US$1=RM4.12) of AI infrastructure in Malaysia, and on Oct 31, Malaysia’s first Nvidia-powered AI data centre in Johor became operational.
On Feb 12, Asia Pacific and Japan hyperscale data centre specialist AirTrunk announced plans to develop its second cloud and AI-ready data centre, AirTrunk
JHB2, located in Iskandar Puteri, Johor.
Meanwhile, Basis Bay’s collaboration with ST Telemedia Global Data Centres was described as a model of how regional partnerships can strengthen Malaysia’s position as a digital hub for Southeast Asia.
This year, the data centre market in Malaysia boomed, driven by demand for cloud computing and rising AI workloads.
Currently, Malaysia has 119 data centres listed, with 15 different markets (locations) in Malaysia.
Johor is becoming Southeast Asia’s fastest-growing data centre hub, which is expected to account for 60 per cent of Malaysia’s capacity by 2030.
Anwar, citing third-quarter 2025 gross domestic product (GDP) data, noted that the services account turned around to record a surplus of RM0.7 billion in that quarter, marking the first surplus in 14 years.
He explained that the achievement was driven by the MADANI Economy strategies, digital transformation through the New Industrial Master Plan (NIMP), the energy transition agenda, the National Semiconductor Strategy (NSS) and highimpact sectors such as data centres.
The rapid development of data centres has benefited the national economy. Although their construction requires substantial initial imports, the assets would eventually generate significant service exports after operations begin, thereby contributing to the overall improvement of the services sector.
“Service export earnings from data centre development are now showing very strong performance,” Anwar stated.
This year, while serving as ASEAN 2025 chair, Malaysia also played an important role in driving the tech sector, including the Asean Technology Cooperation and Development Summit and Asean Digital Ministers’ Meeting, focusing on AI, cybersecurity and digital economy frameworks.
The Digital Economy Framework Agreement (DEFA), which aims to boost digital cooperation and trade in the region by establishing rules in areas such as data
flows, e-payments, and cybersecurity, has made significant progress in negotiations, with the goal of concluding and signing the agreement in 2026.
At the same time, the Malaysia-US Agreement on Reciprocal Trade (ART), signed by both US President Donald Trump and Anwar on Oct 26 during the 47th Asean Summit and related meetings, allows over 1,700 categories of Malaysian goods to enter the US duty-free, including the electrical and electronic sector, which is vital to Malaysia’s economic growth.
Under the ART, Malaysia is now recognised as a trusted supply chain partner, which is expected to facilitate smoother trade flows in goods, including strategic and high-tech products.
Furthermore, Malaysia is intensifying efforts to position itself as a global hub for the semiconductor industry, in line with the government’s strategic aim of moving up the value chain towards integrated circuit design and advanced manufacturing.
According to the Malaysia Semiconductor Industry Association (MSIA), the NSS underscores the country’s commitment to strengthening its role in the global technology ecosystem through targeted investments, talent development, and strong collaboration between the government, industry players, and local startups.
According to the Ministry of Digital, 2026 will be a significant milestone in its efforts to elevate Malaysia into an AIdriven nation.
The ministry noted that the country’s AI ambition goes beyond technology development, as it involves creating a comprehensive ecosystem that integrates
Source: www.nst.com.my
policy, talent, digital trust, and investment, enabling Malaysia to position itself as a competitive, high-impact regional AI hub.
To realise this goal, the government has allocated RM1.36 billion to the ministry under Budget 2026, including RM248.5
million for operating expenses and RM1.11 billion for development projects.
Hence, most analysts said Malaysia’s tech sector outlook for 2026 remains optimistic, driven by the government’s initiatives expected to boost the industry.
Microsoft unveiled US$23 billion in new artificial intelligence investments, with the bulk earmarked for India as the US tech giant deepens its bet on one of the world’s fastest-growing digital markets.
CEO Satya Nadella said Microsoft would spend US$17.5 billion in India in its largest investment in Asia, building on a US$3 billion commitment announced earlier this year.
The four-year spending plan starts in 2026 and would give Microsoft the largest cloud-computing presence in India.
With around a billion internet users and deep tech talent, India has become a key destination for US tech giants, which are
investing billions of dollars to build AI infrastructure.
Data centres are seen as the South Asian country’s best shot at breaking into the boom, given that it has limited chipmanufacturing capabilities.
Google said in October it would invest US$15 billion over five years to build an AI data centre in the southern state of Andhra Pradesh, its biggest commitment in the world’s most populous nation.
The Microsoft spending will “help build the infrastructure, skills, and sovereign capabilities needed for India’s AI first future,” Nadella said in a post on X, sharing a photo of himself with Indian Prime Minister Narendra Modi.
Nadella is in the country for a three-day trip for the company’s AI conferences, with events in the capital New Delhi, IT hub Bengaluru and financial centre Mumbai starting Wednesday.
The investments - the latest big-ticket outlay by technology companies in the high-stakes AI race - come amid a diplomatic standoff between New Delhi and Washington over tariffs and a stalled trade deal.
Microsoft said earlier in the day it would invest more than C$7.5 billion (US$5.42 billion) in Canada over the next two years, with new cloud capacity under the
investment slated to come online in the second half of 2026.
The move was part of its total planned Canada spending of C$19 billion between 2023 and 2027.
That would help the company expand its Azure Local cloud offering in the country, and Microsoft is also partnering with Canadian AI startup Cohere to offer the firm’s advanced AI models on its Azure platform.
The Windows maker and other big US cloud providers are expected to spend more than US$400 billion on AI this year to build out data centres needed to support services such as ChatGPT, Copilot and Gemini.
Source: www.nst.com.my
But that growing spending, limited evidence of real-world AI productivity gains, soaring valuations and a web of circular investments have stoked fears of an AI bubble.
Microsoft said a new data centre in Hyderabad would be its largest hyperscale region in India and is expected to go live in mid-2026. It will also expand its three existing regions in Chennai, Hyderabad and Pune, and has doubled a January pledge to equip 20 million Indians with essential AI skills by 2030.
Total data centre capacity in India is expected to more than triple to about
4.5 gigawatts by 2030, according to real estate consultancy Colliers. One gigawatt of computing power is roughly enough to power about 750,000 US homes.
Microsoft employs more than 22,000 people in India and about 5,300 in Canada.
It announced plans to invest US$10 billion in AI infrastructure in Portugal as well as US$15 billion in the United Arab Emirates last month.
By 60pct
Malaysian companies that adopt artificial intelligence (AI) have improved efficiency by up to 80 per cent and reduced operating costs by up to 60 per cent, exceeding global benchmarks, said the Malaysia Productivity Corporation (MPC).
MPC deputy director-general Dr Mazrina Mohamed Ibramsah said the results were achieved through a handson approach that focused on practical implementation rather than theoretical training, particularly among small and medium enterprises (SMEs).
She said MPC had implemented 600 AI proof of concept projects under the AI for Productivity programme, covering factory automation, AI-enabled production processes, workforce optimisation and real-time customer analytics.
She said the projects had generated value creation exceeding RM400 million.
Malaysia Productivity Corporation (MPC) deputy director-general Dr Mazrina Mohamed Ibramsah (Right) saidMalaysian companies that adopt Artificial Intelligence (AI) have improved efficiency by up to 80 per cent and reduced operating costs by up to 60 per cent, exceeding global benchmarks. — NSTP/ROHANIS SHUKRI.
“MPC’s role is to facilitate. Unlike previous programmes that focused mainly on AI training, where participants are shown various AI tools without clear application, we require companies to first identify their actual problems.
“Companies may face labour shortages, low sales, high costs or challenges in marketing, such as whether to hire agents or develop marketing materials. Many lack sufficient manpower and face high wage costs.
“Once we understand their problems, we introduce the most suitable tools for their needs,” she said after the AI for Productivity 2025 programme.
Mazrina said the initiative was designed to ensure AI adoption was inclusive, with strong emphasis on small firms, local vendors and SMEs, allowing them to strengthen their digital capabilities and become more competitive within the industrial value chain.
In 2025 alone, she said, MPC rolled out 200 AI for Productivity knowledgesharing and mentoring sessions, involving about 3,000 participants from 2,143 companies across 14 sectors.
“Many companies think AI requires heavy capital expenditure. In reality, there are tools in the market that cost less than
Source: www.nst.com.my
RM100 a month or are even free, but can significantly improve productivity if used in the right context.”
To scale adoption across the economy, MPC asked companies to act as “lighthouses”, where selected firms that successfully implemented AI served as benchmarks for others in similar industries.
“With nearly one million SMEs in Malaysia, we cannot reach everyone at once. By developing model companies, we allow others to replicate proven improvements rather than start from scratch.”
She said while international organisations such as the World Bank and the Organisation for Economic Cooperation and Development estimated
productivity gains of 25 to 35 per cent from digital adoption, MPC’s assessments showed efficiency improvements ranging from 35 per cent up to 80 per cent.
“In some cases, efficiency improved by up to 80 per cent, productivity increased by 60 to 80 per cent across companies and projects and cost savings reached 40, 50 or even 60 per cent.”
The AI for Productivity 2025 programme, themed “Empower Learning, Drive Lasting Productivity”, brings together industry players, technology practitioners and representatives from the manufacturing and services sectors to share best practices and showcase successful digital transformation initiatives.
ARTIFICIAL intelligence (AI) continues to dominate global headlines, often painted as a force that will remove more jobs than it creates.
Malaysians see this debate playing out everywhere. In Parliament. In corporate discussions. Even in small businesses trying to stay competitive in a crowded market.
Yet the reality inside Malaysian companies is far more complex.
A conversation last week with the founder of a marketing and advertising firm in Kuala Lumpur revealed how one small and medium enterprise (SME) is growing faster today than at any point in its history despite the rapid adoption of AI across the industry.
Instead of asking whether AI will take our jobs, Malaysia should ask a better question: how do we position ourselves so AI becomes a tool that supports growth rather than a threat to employment? - NSTP FILE PIC.
The founder leads a company that has doubled its headcount in the last 12 months. The company also secured more projects than ever before. This growth took place even as larger regional agencies leaned heavily on AI tools to generate fast proposals.
According to him, the pattern is clear. Malaysian companies reviewing proposals can already tell which ones are created entirely by AI.
“Clients pick it up straightaway,” he said. “Nine out of 10 proposals are generic. The ideas are recycled. Companies are not paying for copy-pasted content. They want thought and intent.”
His firm uses AI for minor support tasks, but the core creative thinking remains with people. That is what clients respond to.
Several Malaysian and international organisations have warned about the shifting nature of work as AI adoption increases.
• A recent Khazanah Research Institute study observed that a significant share of routine and repetitive tasks across manufacturing, finance and administrative support could face automation pressure by 2030.
• Bank Negara has highlighted that logistics, retail and customer service roles are changing quickly as digital systems take on more volume.
• The International Labour Organisation has reported that clerical roles across Asean may face increasing automation as companies streamline operations.
• The World Economic Forum has listed data processing, transcription, basic content generation and standardised support functions among the job categories with the highest exposure to automation.
The Malaysian SME that doubled in size demonstrates a counter-trend. Companies are not simply replacing people. They are becoming more selective about the quality of work they commission.
What clients value most is the one thing AI cannot produce. Nuance. Context. Local understanding. Creative judgment. The ability to ask the right questions and build ideas that feel tailored.
And Malaysia’s agencies are preparing for this transition.
TalentCorp continues to strengthen industry partnerships and build pathways for Malaysians to return from abroad with new skills.
The Malaysia Digital Economy Corporation remains focused on digital-capability building and industryplacement programmes that help companies adopt new tools without reducing headcount.
Instead of asking whether AI will take our jobs, Malaysia should ask a better question. How do we position ourselves so AI becomes a tool that supports growth rather than a threat to employment?
The marketing firm in Kuala Lumpur grew because it understood this early. AI can assist. It cannot replace intention, insight or the human touch that clients recognise immediately.
And no doubt Malaysian companies can tell the difference.
The writer is author of ‘Unleashing Malaysia’s Economic Potential’
The above comments and opinions in the article are the author’s own own and do not necessarily represent Automate Asia Magazine’s view
NIVERSITI Putra Malaysia (UPM) has launched Malaysia’s first Bionic Immersive Lab, a virtual reality and artificial intelligence-based simulation facility aimed at enhancing veterinary education and professional training.
Developed in collaboration with strategic partner G Plus Tech Sdn Bhd, the lab uses immersive, AI-driven VR technology to allow students to practise procedures and decision-making in a simulated environment, reducing reliance on live animals and fieldwork.
The launch was officiated by Professor Emeritus Tan Sri Dr Syed Jalaludin Syed Salim.
According to G Plus Tech chief executive officer Dr Nurliza Md Azzam, the lab is designed to enhance students’ skills and strengthen the education system by promoting self-directed learning through technology.
“With VR, students can learn independently and repeatedly. This is one of our strategies to encourage young people to adopt technology while boosting their confidence.”
Faculty of Veterinary Medicine dean Professor Dr Goh Yong Meng said the technology helps address constraints
such as limited resources, safety risks, disease transmission and time limitations associated with conventional veterinary training.
“Students no longer need to be taken to farms or clinical sites. They can learn anywhere without exposure to safety and biosecurity risks.”
He said the initiative is expected to raise awareness of the importance of veterinary science and deliver long-term benefits not only to students, but also to professionals and the public.
Nurliza said studies showed that VRbased training resulted in up to 80 per cent higher skill retention one year
after training and up to 230 per cent improvement in surgical performance compared with traditional teaching methods.
While the lab currently focuses on veterinary education, G Plus Tech said the technology could be expanded to other sectors, including medicine, technical and vocational education and training, science and technology, human resources, the military, police and architecture.
The company said the initiative marks the beginning of a long-term partnership with UPM, with plans to further develop immersive learning content and platforms. It expressed hope for government support to expand the Bionic Immersive Lab.
UMobile Sdn Bhd is partnering with IGB Bhd to deploy its next generation 5G in-building coverage across 20 IGB’s landmark properties.
The 20 sites account for more than 70 per cent of its high-traffic locations spanning retail, commercial and hospitality segments in Malaysia.
Once deployed, IGB will be able to reap the benefits of seamless 5G connectivity to improve building management and operations, as well as enhance the digital experience for its tenants and customers.
Both parties will work closely to develop use cases to demonstrate how advanced 5G capabilities can support next generation smart buildings.
This partnership will also see U Mobile provide 5G indoor access in these buildings to other telcos.
U Mobile deputy chief executive officer (CEO) Kenneth Chang said the company will make its indoor coverage available to other telcos in line with its commitment to support Malaysia’s broader digital progress.
“We believe their respective customers will also desire to have the same kind of Ultra5G experience provided by our next generation network. This collaboration is just the beginning of more network deployment partnerships, both indoor and outdoor, that we will drive across various sectors in the months ahead,” Chang said.
This partnership will also see U Mobile provide 5G indoor access in these buildings to other telcos. NSTP/SYARAFIQ ABD SAMAD
IGB deputy group CEO Tan Mei Sian said the company is committed to enhancing the value and operational excellence of its properties to continually better serve its tenants, customers and visitors.
“This partnership with U Mobile to deploy their advanced 5G network to enhance indoor coverage is a strategic move that not only future-proofs our assets across the retail, commercial and hospitality segments but also sets us in the right direction in aligning our businesses with Malaysia’s digital transformation agenda.
“This collaboration marks a major milestone in ensuring the best possible connected experience in our properties, which is now a fundamental expectation across world-class developments,” said Tan
As a child, Dr Phang Swee King spent hours tinkering with his toys, interested in taking apart small gadgets just to see what’s inside. Over time, his curiosity grew into an interest in robotics. There was no such course during his time in university, so he enrolled in electrical and electronic engineering.
“Along the way, I became drawn to UAS (unmanned aerial systems), or drones, which I see as flying robots. Today, my work is really a continuation of that childhood curiosity – finding ways to make these systems more useful in everyday life,” says Phang, who is now the Programme Director of the Bachelor of Mechatronics Engineering with Honours at the School of Engineering, Faculty of
Innovation and Technology in Taylor’s University.
At its core, Phang says a robot is a machine with sensors to detect its surroundings and is also equipped with actuators to act on that information.
“People often think of humanoids or drones when they hear the word robot, but robots do not always have to move around as many are stationary yet still serve important purposes. For example, a sorting machine in a factory is also a robot because it uses sensors and mechanisms to perform tasks for us,” he adds.
In the industrial field, robots were built to take on routine tasks such as lifting
parts at an assembly line. Now with advances in AI, automation and IoT, Phang says modern robots can adapt to different situations and even connect with other machines.
He lists the smart home devices that can be controlled through mobile apps as one such example.
“Besides helping in factories, robotics has quietly entered many parts of our daily lives. At home, robotic vacuum cleaners save us time by cleaning floors on their own, and smart appliances such as air conditioners can decide when to switch on, adjust the temperature, and even connect with other devices in the house.
“Even our cars are becoming more robotic, with features such as parking assist, lane keeping, and automatic braking that use sensors to make driving safer and easier. These are all forms of robotics that many people use every day, often without realising it,” he adds.
In Malaysia, Phang sees flying robots or drones as the area with the biggest opportunity for growth in the next five to ten years. He says the application of drones can go beyond photography or recreational flying.
“Drones can be used to monitor road conditions and detect hazards such as potholes, assist during floods and landslides by providing real time information, and even help farmers by surveying crops to improve yields,” he says, adding that the solution has the potential to turn into a practical tool as the tech advances and become more affordable.
As Malaysia aims to expand its 5G coverage in populated, industrial and rural areas to 98% by 2030, Phang believes that the high-speed network can open up new possibilities for robotics. Currently, he says that most drones connect through radio or WiFi, hampering their operating distance and amount of data that can be transmitted.
With 5G, Phang notes, drones can fly farther while maintaining a stable, highspeed connection, enabling them to transmit high-resolution video and sensor data in real time.
“The data can also be processed immediately on the cloud before being sent to the ground station, allowing human operators to receive analysed
As Malaysia aims to expand its 5G coverage in populated, industrial and rural areas to 98% by 2030, Phang believes that the high-speed network can open up new possibilities for robotics. — Taylor’s University
information rather than just raw footage. This makes drones far more effective for road monitoring, agriculture, logistics, and even emergency response,” he adds.
According to Phang, 5G is more than just speed as it also delivers ultra-low latency and the ability to connect to multiple devices at the same time.
“This means drones can be operated safely beyond visual line of sight, with ground stations receiving live data almost instantly. Multiple drones can also be coordinated together through the same network, enabling swarm operations for tasks such as large scale mapping or search and rescue,” he says.
For other robots, Phang says 5G allows for cloud-based processing where heavy computation such as AI-powered image recognition can be done on powerful servers in real time.
“This creates a new level of capability that current WiFi or radio systems cannot provide,” he adds.
For technology like drones to reach its full potential in Malaysia, Phang says clearer and supportive policies that balance safety with the need and deploy new applications are essential.
“With the right framework, Malaysia can unlock many opportunities and even position itself as a regional leader in drone technologies.”
He also believes that ethical thinking will play a major role in how Malaysia adopts robotics and 5G in the years ahead. While 5G- powered drones can be used to assist in road safety or flood monitoring, the same system could also raise concerns about privacy. He says there is a need to consider various consequences before deploying technology.
“What this means for Malaysia is that we need to balance innovation with responsibility. The rollout of 5G will enable robotics to scale up in industries, factories, and even homes, but success will depend on whether we put people first,” he adds.
Cyber threats that shaped the telecommunications sector in 2025 are persisting into 2026 as operators continue to face sustained attacks while rolling out new technologies that introduce fresh operational risks, according to Kaspersky.
The firm said telecommunications operators remained under sustained pressure this year from advanced persistent threat (APT) campaigns, supply-chain compromises, distributed denial-of-service (DDoS) attacks and SIM-enabled fraud.
These threats continued to target operator networks for long-term access, service disruption and illicit monetisation, while the growing complexity of telecommunications ecosystems created multiple entry points for attackers.
Kaspersky data show that between November 2024 and October 2025, 12.79 per cent of users in the telecommunications sector encountered web-based threats, while 20.76 per cent faced on-device threats.
Over the same period, 9.86 per cent of telecommunications organisations worldwide experienced ransomware incidents.
As the sector shifts from rapid innovation to large-scale implementation, Kaspersky warns that technology transitions are adding a new layer of operational risk heading into 2026.
Aritificial intelligence (AI)-assisted network management can amplify configuration errors or act on manipulated data, post-quantum cryptography
deployments risk interoperability and performance issues if rushed and 5G-tosatellite (non-terrestrial network) integration expands service footprints while introducing new dependencies and potential failure points.
Kaspersky GReAT senior security researcher Leonid Bezvershenko said the threats that dominated 2025 are not going away.
They are now intersecting with operational risks from AI automation, quantum-ready cryptography and satellite integration.
“Telecom operators need visibility across both dimensions: maintaining strong defences against known threats while building security into these new technologies from day one.
Source: www.nst.com.my
“The key is continuous threat intelligence that spans from endpoint to edge to orbit,” he added.
To strengthen resilience, Kaspersky advises telecommunications operators to continuously monitor APT activity and infrastructure exposure, manage AI-driven automation through strong human oversight and phased rollouts and treat DDoS protection as a core capacitymanagement priority.
The company also recommends deploying advanced endpoint detection and response capabilities to enable early threat detection, rapid investigation and effective incident containment.
Interview with
Driving Sustainable Innovation in the Semiconductor Industry through Integrated Technologies
Shinichi Sakai, Managing
Director,
Hitachi Asia Ltd.
Shinichi Sakai, Managing Director, Hitachi Asia Ltd.
1. For those who may be less familiar, can you give us a brief overview of Hitachi’s presence and key focus areas in the manufacturing and semiconductor sectors?
Hitachi has a long-standing legacy in advancing industrial innovation, and today we continue to play a pivotal role across both the manufacturing and semiconductor sectors. The semiconductor industry is currently experiencing a surge in demand driven by transformative technologies like AI, electric vehicles, and 5G connectivity. This growth, however, brings significant challenges, including managing escalating costs, mitigating environmental impact, and addressing increasingly complex production processes.
Our integrated approach combines operational technology (OT), information technology (IT), and deep domain expertise to deliver intelligent, futureready solutions. In manufacturing, we focus on smart production enabled by AI, IoT, analytics, and automation.
For semiconductors, we offer a comprehensive portfolio covering frontend and back-end processes, from precision etching and inspection systems to energy-efficient infrastructure and materials handling. Our solutions are designed to meet the high standards of semiconductor fabrication while supporting global sustainability goals.
2. How has Hitachi’s strategy evolved in recent years to support the growing demand for digitalisation and sustainability in industrial operations?
As semiconductor demand grows, so does the need to tackle environmental impact and operational complexity. The industry consumes large amounts of water, chemicals, silicon, and energy, especially in plasma and high-temperature processes that emit potent greenhouse gases. Reducing this footprint has become a critical priority.
Our strategy has evolved to meet both digital transformation and sustainability goals through our “One Hitachi” approach, integrating expertise across energy, mobility, IT, and industrial systems. By addressing the entire manufacturing value chain, from raw materials and production to logistics and facility management, we ensure a comprehensive and effective response to complex challenges.
To support digital transformation, we have expanded our focus on AI, automation, IoT, and advanced analytics, allowing our customers to enhance operational efficiency, reduce unplanned downtime, and improve system
resilience. These technologies underpin smarter, more connected manufacturing environments that increase productivity while supporting long-term cost and resource efficiency.
On the sustainability front, we are committed to achieving carbon neutrality across our entire value chain by 2050. This commitment is reflected in the development of SF6-free power solutions, oil-free compressors, and energyoptimised production technologies that reduce emissions and support global ESG goals. Additionally, our investments in autonomous robotics and sustainable materials logistics are helping to minimise waste and improve supply chain performance.
At SEMICON Southeast Asia 2025, we showcased these efforts with solutions that span energy management, production, and logistics, highlighting how we are enabling more resilient, intelligent, and sustainable semiconductor manufacturing.
Ultimately, we aim to empower our customers to succeed in a rapidly changing industrial landscape by making operations not only smarter, but cleaner and more future-ready.
3. Can you share how Hitachi works with semiconductor manufacturers across the region, particularly in Southeast Asia?
We work hand-in-hand with semiconductor manufacturers across Southeast Asia to help them navigate the evolving demands of innovation, efficiency, and environmental responsibility. Our role goes beyond supplying equipment; we collaborate closely with our customers to co-create solutions that meet their operational goals while supporting long-term sustainability.
From energy and facility management to production and logistics, our solutions are designed to address the full spectrum of challenges faced by manufacturers today. For example, we support greener operations through smarter, more resilient energy systems. Our commitment to global ESG targets is reflected in our SF6-free technologies, which significantly reduce greenhouse gas emissions at fabrication facilities.
In logistics, we help manufacturers increase cleanroom efficiency and reduce waste through intelligent automation, including the deployment of Autonomous Mobile Robots (AMRs) that optimise material handling within semiconductor plants.
On the production side, we are advancing both front-end and backend manufacturing processes, from AIpowered recipe development to process optimisation, with automation and oilfree compressors. These technologies enable high precision, reliability, and regulatory compliance while reducing environmental impact.
Through close collaboration with our customers, ongoing investment in regional capabilities, and a strong commitment to co-innovation, we continue to
play a strategic role in strengthening Southeast Asia’s position as a global leader in sustainable semiconductor manufacturing.
4. Hitachi has been at the forefront of energy-efficient infrastructure. How do solutions like EconiQ™ GIS, Digital Transformers, and GrideXpand™ support semiconductor fabs in building low-carbon, resilient power systems?
We recognise that as semiconductor manufacturing becomes more advanced, it also becomes more energy-intensive. That’s why we are committed to helping fabs transition to low-carbon, resilient power systems by integrating nextgeneration infrastructure technologies into their operations.
For instance, our EconiQ gas-insulated switchgear (GIS) plays a critical role in this transition. Traditional GIS systems use SF6, a potent greenhouse gas, but EconiQ GIS is completely SF6-free, offering the same high performance and reliability while significantly reducing environmental impact. This makes it
especially valuable in semiconductor fabs, where demand for clean, stable, and high-capacity power infrastructure is increasing, while also helping to meet sustainability goals.
Alongside this, our digital transformers, powered by the TXpert™ Ecosystem, digitally revolutionise transformer performance through real-time data monitoring, predictive analytics, and improved asset management, enhancing grid resilience and supporting the transition to a more sustainable and flexible energy system.
Our Grid-eXpand™ is a modular, prefabricated grid connection solution that accelerates deployment of compact, high-voltage substations with minimal onsite construction. Designed for scalability and tailored to specific needs, it reduces construction risks and allows easy upgrades and fleet harmonisation. This makes it ideal for new or expanding fabs where space is limited and operational continuity is critical, helping semiconductor manufacturers stay agile while lowering their carbon footprint.
5. What measurable impact have these technologies had in reducing energy consumption or emissions in high-demand environments like chip manufacturing?
At SEMICON SEA 2025, we showcased 17 integrated solutions that collectively address energy use, emissions, water consumption, and operational efficiency – all aimed at building smarter, more sustainable fabs. Under Energy & Management, we featured our EconiQ gas-insulated switchgear, designed for maximum energy efficiency and sustainability, helping to reduce greenhouse gas emissions by using SF6free technology.
In the Material/Logistics domain, we presented our value chain and supply chain solutions that improve procurement efficiency through materials inspection, inventory management and promote the use of sustainable materials. In addition, the use of Autonomous Mobile Robots (AMRs) which can be used both within
the factory grounds as well as the clean fabrication environment help to optimise material handling.
On the production side, our customisable automation solutions provide high speed and high precision. Available in various configurations, Hitachi’s process and metrology equipment (Etcher, CD-SEM, SEM, etc.) are designed to meet stringent process requirements and deliver highquality outputs. Compressed monitoring solutions enable proactive maintenance of compressors through real-time monitoring, alerts, and failure history tracking.
Collectively, these innovations not only enhance operational efficiency but also contribute directly to fabs’ ESG reporting. They help reduce power loads, minimise chemical waste, and lower carbon emissions throughout the production lifecycle, offering measurable sustainability gains for the semiconductor sector.
6. Manufacturers are under increasing pressure to streamline operations while reducing their environmental impact. How is Hitachi integrating robotics and smart material handling to enhance agility and sustainability within semiconductor production lines?
Semiconductor manufacturers face rising operational costs and complexity due to sophisticated chip designs, alongside environmental pressures and supply chain disruptions intensified by global trade conflicts. At the same time, there is a serious shortage of skilled engineers, making efficiency and automation even more vital.
We help semiconductor manufacturers deploy Autonomous Mobile Robots (AMRs) to improve material flow and logistics within fabs, reducing human error resulting in less material wastage. These intelligent systems optimise wafer, tool, and material transport across production stages, supporting operational agility and sustainability. Our integrated approach leverages robotics and digital technologies to address energy management, material logistics, and production challenges, enabling manufacturers to meet their efficiency and environmental goals despite industry headwinds.
7. Precision and efficiency are critical in wafer processing. How do your EFEM (Equipment Front End Module) systems, compressor monitoring, and smart maintenance solutions help improve process stability while cutting down on energy and material waste?
The semiconductor industry often struggles with rigid recipe development and maintenance inefficiencies that lead to increased downtime and resource waste.
Our EFEM systems are fully GEM300compliant and customisable, enabling smooth integration across diverse process tools and flexible production line coordination.
Minimising human error with consistent panel handling, panel breakage is reduced because of gentle, precise handling, decreasing contamination and lowering scrap rates as a result. Efficient scheduling and handling optimise throughput
significantly, improving process repeatability and yield.
Our oil-free compressors, paired with IoT-powered compressor monitoring, provide real-time alerts and failure tracking that support proactive maintenance, reducing unplanned outages and extending equipment lifespan. By improving process stability through automation and optimising resource use, these technologies help manufacturers reduce energy consumption and material waste, addressing both operational and environmental challenges.
8. How does Hitachi’s approach to predictive maintenance contribute to both sustainability and productivity on the factory floor?
Given the semiconductor industry’s shortage of specialised engineers, predictive maintenance becomes crucial for sustaining productivity. Our approach
uses real-time monitoring and advanced analytics to detect potential equipment issues early, preventing unplanned downtime that disrupts production schedules.
Our smart maintenance solutions increase equipment uptime through efficient maintenance operations, empowering field service engineers with real-time AI advice and training through virtual demonstrations.
From a sustainability perspective, this proactive maintenance reduces unnecessary repairs, conserves resources, and ensures machines operate efficiently, avoiding energy spikes from equipment faults. The result is a more reliable factory floor that supports environmental goals while maximising throughput, a vital balance for modern semiconductor manufacturing.
9. Hitachi operates across energy, digital, industrial, and automation sectors. How does this crossdomain expertise create synergy in addressing sustainability challenges across the semiconductor value chain?
Our cross-domain capabilities allow us to deliver integrated solutions that tackle sustainability challenges holistically, from energy optimisation to smart manufacturing and logistics.
For example, our energy management solutions optimise power usage and support low-carbon operations, while our digital technologies provide real-time data analytics for smarter decision-making. In the industrial and automation domains, we deliver advanced manufacturing systems, including customisable automation solutions, EFEMs and autonomous mobile robots, to improve material handling and production precision.
This holistic approach allows us to tackle complex challenges, from reducing greenhouse gas emissions to minimising material waste, across design, fabrication, logistics, and facility management. By leveraging cross-domain innovation, we help semiconductor manufacturers accelerate their sustainability goals while maintaining competitive operational performance.
10. In your view, what makes Hitachi uniquely positioned to help semiconductor manufacturers meet their ESG targets?
Our strength lies in combining deep technical expertise and digital solutions with a long-standing commitment to sustainability. We offer end-toend solutions, from energy systems and sustainable material handling to equipment monitoring and digital solutions, that directly support ESG outcomes.
At the heart of this is our “One Hitachi” approach, which unites diverse capabilities and innovations across multiple sectors, including energy, IT, industrial systems, and automation. By breaking down traditional silos, we create seamless integration of technologies and services that address the full spectrum of semiconductor manufacturing challenges.
This cross-sector collaboration enables us to deliver holistic, tailored solutions that optimise power efficiency, improve operations reliability, and reduce environmental impact throughout the manufacturing value chain. As a result, our customers gain measurable benefits, such as enhanced resilience, increased productivity, and progress towards sustainability targets, empowering them to thrive in a rapidly evolving industrial landscape.
By Ir. Ts. Prof. Dr. Chee-Fai Tan
Vice
President
(Technology), Malaysia Association for Sustainable Supply Chain & Innovation (MASSCI)
Deputy Vice-Chancellor, Kuala Lumpur University of Science & Technology (KLUST)
Artificial Intelligence has transformed how supply chains interpret data. Demand forecasting, inventory optimisation, route planning, and predictive maintenance now rely on increasingly sophisticated analytics.
Yet improved visibility does not automatically translate into improved execution.
Many organisations operate with realtime dashboards and predictive tools, but warehouse congestion, manual bottlenecks, and coordination delays persist. The gap lies between intelligence and action.
This is where Physical AI is emerging as the next operational layer.
From Software Intelligence to Embodied Systems
In supply chain contexts, this includes:
• Autonomous mobile robots navigating live warehouse traffic
• AI-driven material handling systems adjusting in real time
• Production lines synchronising through sensor-enabled coordination
• Cold-chain systems dynamically regulating storage conditions
The distinction is not conceptual. It is operational.
Software AI informs.
Physical AI executes.
ASEAN supply chains are expanding rapidly as global manufacturing diversifies across the region. However, operational maturity varies.
Many firms have invested in ERP systems and digital dashboards. Fewer have integrated intelligent physical systems that adapt to changing production conditions in real time.
For example:
A warehouse may predict peak volume surges, yet still rely on static picking routes. A production facility may forecast maintenance needs, but lack automated
systems capable of adjusting workflows immediately when disruptions occur.
In such environments, decision latency — not information scarcity — becomes the limiting factor.
Physical AI addresses this latency by reducing the distance between analysis and action.
Warehousing and Intralogistics
AI-enabled mobile robots can dynamically reroute to avoid congestion and reprioritise tasks based on shifting demand. Unlike rule-based automation, these systems learn from environmental feedback, improving throughput consistency.
In smart factories, Physical AI allows machines to coordinate based on live sensor data. When upstream variability occurs, downstream systems adjust sequencing automatically, reducing scrap and idle time.
In regulated sectors, intelligent monitoring systems can autonomously recalibrate storage environments when deviations occur, maintaining compliance integrity without manual intervention.
Across these applications, the objective is not mechanisation alone. It is adaptive execution.
The transition toward Physical AI must be deliberate.
Industrial environments demand reliability and accountability. A phased approach is therefore essential:
1. Deploy AI-enhanced robotics in controlled operational zones.
2. Integrate predictive models with physical execution systems.
3. Expand toward coordinated, multinode autonomy across facilities.
At each stage, governance frameworks must ensure safety, transparency, and traceability.
Autonomy without oversight introduces new risks.
Human Capability in an Autonomous
As physical systems gain adaptive capability, human roles evolve rather than disappear.
Engineers increasingly focus on:
• System orchestration
• Exception management
• Continuous optimisation
• Cyber-physical security
The workforce shift is from manual coordination toward systems supervision and design.
ASEAN’s competitiveness will depend not only on technology adoption, but also on developing the technical and governance capabilities required to manage intelligent physical systems responsibly.
Physical AI is not a replacement for digital intelligence. It extends it into execution.
For ASEAN manufacturers and logistics providers, the strategic question is not whether analytics capabilities will continue to advance. They will.
The question is whether execution systems will evolve in parallel, such as reducing latency, absorbing variability, and operating with adaptive resilience.
Organisations that align digital insight with intelligent physical execution will
reduce coordination gaps and enhance operational stability.
Supply chains are becoming increasingly data-rich. Their next phase of competitiveness will depend on how effectively intelligence is translated into action.
About the Author
Vice President of Technology at Malaysia Association of Sustainable Supply Chains & Innovation (MASSCI) and The Deputy Vice-Chancellor of Kuala Lumpur University of Science & Technology (KLUST). He is an internationally recognized expert in smart manufacturing, digital transformation, AI, and robotics. Prof. Tan also serves as Chair of the ASEAN Engineering Inspector for Mechanical & Manufacturing and contributes to ISO/IEC and WFEO initiatives on engineering innovation and sustainability.
By the Machinery & Engineering Industries Federation (MEIF)
Automation is no longer novel within Malaysia’s machinery and engineering (M&E) sector. Robotic welding cells, CNC upgrades, ERP platforms, machine vision systems, and warehouse automation are increasingly common across factories of varying scale.
Yet a structural gap persists.
While many firms have automated discrete processes, fewer have embedded those investments within an integrated capability framework. The distinction is not semantic. It directly affects resilience,
audit performance, and long-term competitiveness.
Automation improves individual tasks. Sustainable performance depends on whether those tasks operate within disciplined processes, aligned standards, coordinated planning, and accountable governance structures.
The Automation Illusion
Across the sector, manufacturers report familiar symptoms:
● OEE variability despite automation investments
● Scrap rates that remain elevated in mixed-model production
● Downtime clustering linked to weak maintenance integration
● Traceability gaps during customer or regulatory audits
● Manual workarounds within digitised workflows
These patterns do not necessarily indicate technology failure. More often, they reflect incomplete systems integration.
Where automation is deployed without synchronising planning, quality control, maintenance, logistics, and data governance, complexity increases while coherence remains fragile.
Installing robotics does not automatically stabilise sequencing discipline. Digitising workflows does not ensure crossfunctional coordination. Dashboards provide visibility, but visibility alone does not resolve structural misalignment.
Global buyers increasingly assume a baseline level of automation. What differentiates suppliers is their ability to demonstrate:
● Traceability under audit
● Standardised operating procedures
● Predictable lead times
● Risk management discipline
● Governance consistency across facilities
As supply chains fragment under geopolitical recalibration and compliance
scrutiny intensifies, variability that once went unnoticed now carries contractual and reputational risk.
Automation may be necessary. Capability maturity determines credibility.
Industrial capability rests on interdependent pillars:
1. Process discipline
2. Standards alignment
3. Skills architecture
4. Operational governance
5. Continuous improvement systems
Technology strengthens these pillars when integrated coherently. On its own, it does not substitute for them.
ASEAN’s expanding role in global manufacturing creates opportunity, but also exposes structural weaknesses.
Output expansion without governance maturity increases systemic risk. Performance variance is not merely operational inefficiency; in volatile
markets, it compounds financial exposure and erodes buyer confidence.
The next phase of competitiveness in Malaysia’s M&E sector will depend less on the volume of automation deployed and more on the consistency with which firms can:
● Maintain performance stability under volatility
● Demonstrate compliance transparency
● Synchronise production and logistics planning
● Standardise execution across facilities and shifts
This is fundamentally a systems challenge.
Industrial upgrading rarely succeeds through isolated vendor deployments or pilot projects alone. Sector-wide competitiveness depends on raising the median capability maturity across firms.
Industry institutions contribute by:
● Encouraging shared maturity benchmarks
● Facilitating cross-sector dialogue
● Supporting structured capability mapping
● Promoting standards alignment
● Bridging industrial practice with policy frameworks
Isolated excellence does not secure ecosystem resilience. Coordinated maturity does.
Digitalisation introduces tools and data visibility. Industrialisation requires structural integration across processes,
standards, governance, and workforce capability.
Malaysia’s M&E competitiveness will depend on how effectively firms translate automation investment into:
● Stable OEE performance
● Reduced inter-shift variance
● Improved MTBF through predictive maintenance integration
● Standardised traceability protocols
● Governance systems that scale with growth
Automation reduces labour intensity and enhances efficiency. Long-term relevance in global supply chains depends on whether those efficiencies are embedded within disciplined, resilient operating models.
In the coming decade, firms that sustain performance will be those that treat automation as one component of a broader capability architecture — designed to remain stable even as external conditions fluctuate.
● Sit within or immediately after “The Automation Illusion” section.
● Be visually differentiated (light grey background, border, or typographic contrast).
A mid-sized precision machining firm installs automated CNC cells and a warehouse management system. Machine utilisation improves, yet ontime delivery continues to fluctuate. Review reveals that production sequencing, tool-change coordination, and material staging remain manually synchronised across departments. While the equipment performs as specified, variability persists because cross-functional planning and governance were never standardised. The constraint lies not in automation itself, but in the integration of processes around it.
By Prof Datin Lorela Chia
Across ASEAN, industrial investment is accelerating. Automation platforms, AI systems, advanced manufacturing tools, and integrated analytics are increasingly accessible. Capital deployment is rising, and policy frameworks are evolving to support digital and industrial upgrading.
Technology availability is no longer the primary constraint.
The more pressing question is whether industrial systems are expanding their Complexity Absorption Capacity at the same pace that they are adding complexity.
Every industrial organisation operates within structural limits. There is a
threshold to how much operational variability, technological layering, regulatory demand, and cross-functional coordination a system can integrate without destabilising performance. When complexity grows faster than that threshold, volatility increases.
This is not a cultural issue. It is structural.
Defining Complexity Absorption Capacity
Complexity Absorption Capacity refers to an organisation’s ability to integrate additional operational, technological, and regulatory layers without degrading performance stability.
It is shaped by:
● Process standardisation across functions
● Governance clarity in decision rights
● Data integrity and interoperability
● Institutional memory and documentation discipline
● Cross-functional planning alignment
● Supplier and ecosystem synchronisation
When these foundations are mature, complexity can be layered progressively. When they are uneven or underdeveloped, additional systems amplify variance rather than reduce it.
In many factories, automation improves isolated metrics — cycle time, labour intensity, or throughput. Yet performance variability persists because sequencing discipline, integration depth, and governance consistency have not kept pace.
The constraint is rarely access to tools. It is the system’s capacity to absorb and stabilise what those tools introduce.
The Cost of Over-Acceleration
Acceleration is visible. Absorption is not.
Installation milestones are reported. Integration lag rarely is.
When complexity expands faster than structural capacity, the symptoms surface indirectly:
● Escalating compliance remediation costs
● Audit findings rooted in data inconsistency rather than technical failure
● Procurement friction as supplier tiers modernise unevenly
● Decision bottlenecks where governance clarity lags technological autonomy
● Increased reliance on informal coordination to stabilise formal systems
These patterns do not reflect resistance to change. They indicate absorption imbalance.
In volatile trade conditions, such imbalance carries strategic consequences. Variability that once remained internal now affects contractual reliability and cross-border credibility. Performance instability is no longer an operational inconvenience; it becomes a competitive liability.
Complexity unmanaged at firm level eventually manifests as systemic fragility at sector level.
Ecosystem-Level Capacity
Complexity Absorption Capacity does not reside solely within individual enterprises. It operates across industrial ecosystems.
ASEAN’s manufacturing competitiveness depends on the synchronisation of:
● Standards interoperability
● Supplier digital maturity
● Workforce capability depth
● Regulatory coherence
● Data governance frameworks
When leading firms accelerate automation while supplier tiers remain structurally uneven, integration friction increases. When compliance regimes intensify without parallel capability development, strain accumulates downstream. When digital architectures are layered without standards alignment, fragmentation multiplies.
Industrial policy that emphasises adoption without equal emphasis on integration risks amplifying systemic variance.
Ecosystem maturity therefore requires coordinated pacing.
Sector-wide capacity cannot be built through isolated excellence. It strengthens when median capability levels rise across tiers and when institutions reinforce sequencing discipline rather than only deployment speed.
Complexity, once introduced, cannot easily be reversed. Absorption capacity must therefore expand in parallel.
Sequencing as Discipline
Building Complexity Absorption Capacity is not an argument against ambition or innovation. It is an argument for sequencing.
In advanced manufacturing environments, performance stability depends on the deliberate layering of complexity upon coherence.
Standardisation must stabilise before automation scales.
Governance clarity must precede distributed autonomy.
Cross-functional alignment must mature before optimisation algorithms compound variability.
Ecosystem interoperability must strengthen before cross-border integration deepens.
Industrial maturity compounds when integration depth matches innovation velocity.
Installation is immediate.
Maturity is structural.
The next phase of ASEAN’s industrial development will not be determined by the volume of technology deployed, but by the structural readiness of its systems — firm-level and ecosystem-level — to absorb what that technology demands.
Industrial maturity is built through discipline sustained over time. Where complexity is introduced with integration readiness, performance compounds. Where it is layered without structural reinforcement, volatility follows.
In advanced manufacturing, the distinction is consequential.
the Author
Datin Lorela Chia is Founding President of the Malaysia Association of Sustainable Supply Chain & Innovation (MASSCI) and Vice President I of the Machinery & Engineering Industries Federation (MEIF). She chairs the Supply Chain & Ecosystem Development Workgroup under the Machinery & Equipment Productivity Nexus (MEPN) and serves on its National Governing Committee.
Her work focuses on strengthening sustainable supply chains, advancing industrial transformation, and designing trust infrastructure across ASEAN manufacturing ecosystems. She works at the intersection of policy, industry capability, and systems-level integration to elevate structural maturity in the machinery and engineering sectors.
Given the rise of global economic uncertainty following the Trump administration’s unilateral reciprocal tariff imposition and its looming introduction of the semiconductor tariff on its trading partners, the latest forecast of Taiwan’s GDP growth has certainly defied the gloomy outlook of the world economy. - AI image, for illustration purpose only
Apiece of news that has gone unnoticed by the Malaysian media: Taiwan’s gross domestic product (GDP) is predicted to grow at a whopping 7.37 per cent for the year 2025 ─ a level unseen since the 10.25 per cent growth 15 years ago. Adding to the disbelief is that this forecasted rate is much higher than the 4.45 per cent prediction made just four months earlier. Given the rise of global economic uncertainty following the Trump administration’s unilateral reciprocal tariff imposition and its looming introduction of the semiconductor tariff on its trading partners, the latest forecast of Taiwan’s GDP growth has certainly defied the gloomy outlook of the world economy.
At the same time, Wiwynn Chairwoman, Emily Hong, has, for the first time, officially confirmed that her company is the manufacturing and infrastructure partner for the YTL Group’s AI data centre in Johor. This, in effect, puts to rest the market rumour regarding the Taiwanese company’s involvement in the project, considering that it is the supplier to American hyperscalers such as Amazon Web Services, Microsoft, and Meta. Likewise, such news is hardly reported by the Malaysian media outlets, which focus on YTL’s cooperation with Nvidia ─ the artificial intelligence (AI) giant, which also outsources its infrastructural manufacturing to its list of Taiwanese suppliers.
From these two pieces of news, it is clear that Taiwan is ‘quietly’ riding on the global AI wave as the manufacturing partner for the US, as well as companies cooperating with the American tech multinationals, with the likes of YTL. Yet, such a reality continues to be absent in public discussions about Malaysia tapping the global AI wave as a driver instead of just being a host of data centres. More importantly, there have been persistent calls for Malaysia to achieve a resilient supply chain for risk reduction, but no consideration is paid to Taiwan’s indispensable position in the entire AI supply chain. By all means, such a discursive vacuum is certainly baffling for any observer of geoeconomics and supply chain security today. This begs a
question: How much do we understand Taiwan’s current standing in the global AI supply chain today?
To begin with, there are three hard facts that are to be recognised. First, Taiwan’s indispensability in the global AI supply chain spans beyond its role as the chip producer as in the case of Taiwan Semiconductor Manufacturing Company (TSMC). Rather, Taiwan has institutionalised itself as the supplier (manufacturer) of other AI infrastructures used in data centres: the servers used in data centres; the motherboards and power modules inside each server; the liquid cooling systems needed to operate the high-computing-power of AI data centres; and the server racks that integrate all servers into one system.
As stipulated within Morgan Stanley’s AI supply chain report, released in March 2024, it is estimated that 78 per
cent of Nvidia’s AI servers in 2024 will come from seven Taiwanese companies, namely Quanta, Inventec/ZT Systems, Hon Hai, Wistron, Wiwynn, Giga-Byte and Asustek. From AI server design, rack production-integration to the provision of manufacturing services, these are the ‘Big Seven’ that drive Taiwan’s electrical and electronic (E&E) exports to the US and countries hosting the American tech multinationals.
Second, Taiwan has a complete tech manufacturing ecosystem that is hard to replicate by any economy in the world, with the exception of South Korea. Be it IC design, chip manufacturing, IC packaging, research and development (R&D), E&E training or the wider AI infrastructural production, its economy has its presence in each of these domains. Such a feat is no coincidence but the outcome of 50 years of continuous investments, operations and innovations by the Taiwanese private and public players in higher education, regulatory and business sectors.
As revealed by Nvidia’s founder, president and CEO Jensen Huang, back in 2024, there are altogether 59 Taiwanese entities (companies and universities) involved in the multinational giant’s AI supply chain, to which it also controls 92 per cent of the world’s graphic processing unit (GPU) market based on the data by Jon Peddie Research (JPR). It therefore makes sense when Huang clearly stated that, “Taiwan is where everything Nvidia does begins, (before) our partners and ourselves take it to the world.” Apart from South Korea, which also plays an indispensable role in the supply of high-bandwidth memory (HBM) to Nvidia and with similar scale of tech manufacturing ecosystem as Taiwan’s, it is arguably difficult, if not impossible, for other economies (including the US) to replace the latter in the entire AI supply chain.
Third, Taiwanese companies have also become major suppliers of the nonNvidia AI supply chain today. In the latest gambles by Amazon and Google to dislodge Nvidia’s monopoly of GPU market as well reduce their dependence on the AI giant’s chips, both companies are in the midst of deploying the application-specific integrated circuit (ASIC) chips - which in turn, are installed within their respective central processing units (CPUs) and tensor processing units (TPUs) - to operate their own data centres as well as those of their customers’.
Once again, Taiwanese companies remain the manufacturing partners for both Amazon and Google. Whereas the TSMC is the supplier of the cutting-edge chips to both American clients, both Alchip Technologies and MediaTek have become the latest IC design companies from Taiwan, engaged by the two American tech giants. In all, these latest developments reflect another hard fact that Taiwanese companies continue to be the most reliable partners within the newly-emerged supply chains driven by Amazon and Google in their endeavours to carve out their own AI markets.
Be it the AI infrastructures led by Nvidia or those driven by Amazon and Google, all three hard facts have demonstrated that Taiwan’s grasp of the AI supply chain
is both extensive and deep. But unlike the Nvidia-led supply chain, which had been explored by Morgan Stanley, the complete landscape surrounding the varying roles of Taiwanese companies in the emerging ASIC supply chains driven by Amazon and Google is virtually unknown to the world.
To this, more academic and market research can be conducted to examine Taiwan’s current standing in the global AI supply chain. This is particularly important to semiconductor economies like Malaysia, which is seeking to ride the AI wave but continues to be dependent on Taiwan for AI infrastructures that operate their data centres. Needless to say, such a dependency contradicts the goal of establishing a resilient supply chain as touted by the Malaysian government.
That said, instead of taking Taiwan as a competitor, to which it is not, a thorough examination of its E&E manufacturing experiences offers good lessons to Malaysia on how to build its presence in the current AI supply chain. It is time for us to study the case of Taiwan in the global AI supply chain today.
The writer is Senior Lecturer at the Institute of China Studies (ICS), Universiti Malaya and Advisor to Taiwan Chamber of Commerce in Malaysia (TWCHAM)
The above comments and opinions in the article are the author’s own own and do not necessarily represent Automate Asia Magazine’s view
Automate Asia Magazine attended the Asia Photonics Expo 2026, held from 4–6 February 2026 at the Sands Expo and Convention Centre, Marina Bay Sands, to provide on-site coverage of one of the region’s key exhibitions dedicated to photonics, laser technologies and precision manufacturing applications.
The three-day event brought together photonics solution providers, advanced component manufacturers, research institutions and system integrators from across Asia and beyond. This year’s exhibition reflected the growing strategic importance of photonics technologies in semiconductor manufacturing, electronics production, medical devices and advanced industrial automation.
Exhibitors showcased a comprehensive range of laser systems, optical components, imaging technologies and precision measurement solutions. Increasingly, these technologies are being integrated directly into automated production environments, supporting higher accuracy, faster processing speeds and improved quality control. Discussions on the exhibition floor centred not only on technological advancement, but also on scalability, seamless system integration and cost-effective deployment.
Artificial intelligence and smart sensing technologies were also prominently featured, particularly in high-resolution inspection, defect detection and realtime monitoring systems. The integration of photonics with AI-driven analytics illustrates the convergence of optical engineering and digital manufacturing, further reinforcing the role of precision technologies within Industry 4.0 frameworks.
Beyond innovation, strategic partnerships emerged as a key theme throughout the event. During our
engagement with exhibitors, there was notable interest in regional collaboration and expansion, particularly within Malaysia’s developing manufacturing ecosystem. Industry players highlighted the importance of cross-border partnerships within the Johor–Singapore corridor, supply chain alignment and technology collaboration to support longterm scalability. As industrial growth continues in southern Malaysia, advanced photonics solutions are expected to play an increasingly vital role in enabling nextgeneration production facilities.
The insights gathered at Asia Photonics Expo 2026 reaffirm the accelerating
demand for high-precision, data-driven manufacturing solutions across Southeast Asia. As industries move towards greater digitalisation and tighter quality requirements, photonics technologies are positioned as critical enablers of advanced manufacturing transformation.
Automate Asia Magazine will continue to feature selected interviews and technology highlights from Asia Photonics Expo 2026 in this and upcoming issues, providing readers with deeper insight into the innovations shaping the future of precision engineering and industrial automation in Asia.
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