New Delhi, Aug. 27 -- The US government's decision to acquire a 9.9% equity stake in semiconductor giant Intel Corp. marks a significant new direction in state policy, as the US battles to retain its fast-eroding leadership in semiconductor technology.

According to Intel, the US government's equity purchase will be funded by converting $5.7 billion of $7.9 billion of grants awarded to the company under the Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act into equity.

Another $3.2 billion pledged to Intel as part of the US's 'Secure Enclave' programme, which is aimed at ensuring a protected source of supply of microelectronics for US defence and strategic requirements, will also be converted into common Intel stock. The ...