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New Delhi: Traditionally, governments use grants, tax incentives, and subsidies for strategic industries. More and more often, however, policymakers are looking for a different solution: direct investment in companies deemed important for national competitiveness. While the concept is still a subject of debate, it has become a topic of interest as nations strive to build up their own capabilities in sectors like semiconductors and artificial intelligence.
The issue came up again when U.S. President Donald Trump recently touted the federal government’s investment in Intel as one of his best industrial policy moves. In an interview with CNBC, Trump stated that the government had obtained a 10% stake in Intel and claimed the investment had generated between $60 billion and $70 billion in value within months.
Trump said Intel contacted his administration during a challenging time for the company, when the United States semiconductor industry was being severely challenged by Asian manufacturers. He said that previous governments had neglected to safeguard local chipmakers, resulting in Taiwan’s dominance in the global semiconductor industry.
Trump explained that the negotiations were based on his idea that the U.S. government should have an ownership stake in the company rather than simply providing financial assistance. He said taxpayers should directly benefit whenever public money is used to support strategically important businesses.
The deal, announced in August 2025, involved an $8.9 billion investment by the US government in Intel through newly issued shares, giving Washington an ownership stake of about 9.9%. The investment was funded through the CHIPS and Science Act, which aims to expand semiconductor manufacturing in the United States and reduce dependence on overseas production.
The arrangement was not a bailout, but instead allowed the government to hold a passive equity stake without operational control. The objective was to strengthen Intel’s finances and support the expansion of advanced chip manufacturing facilities across the country. Trump has repeatedly cited the investment as evidence that government participation in strategic industries can generate financial returns while supporting national manufacturing goals.
The Intel discussion has also gained attention because of reports that OpenAI is exploring the possibility of offering the US government a 5% equity stake. According to multiple media reports, the proposal remains at an early stage and has not been finalised. The discussions are reportedly aimed at strengthening cooperation with the administration as scrutiny of advanced AI technologies continues to grow.
Although the two situations involve different industries, they point to a broader shift in how governments may engage with strategically important technology companies. Equity participation is emerging as another option alongside grants and incentives to encourage domestic investment while allowing the public sector to share in potential financial gains.
Supporters argue that this model aligns taxpayer interests with corporate success and ensures governments benefit when public investments generate value. Critics, however, question whether governments should become shareholders in private companies, warning that such arrangements could blur the line between industrial policy and market competition.
Trump used the Intel investment to reinforce his broader economic message, describing the current period as a “Golden Age” of American manufacturing. He linked the administration’s tariff policies and semiconductor investments to efforts aimed at rebuilding domestic production capacity and reducing reliance on foreign supply chains. According to Trump, a stronger domestic manufacturing base is essential for maintaining America’s technological leadership.
Whether equity-based industrial policy becomes a permanent feature of US economic strategy remains uncertain. However, governments are increasingly reassessing how they support industries considered critical to national security and long-term economic growth. Alongside subsidies, tax incentives and regulatory support, direct equity investments are likely to remain part of the conversation as global competition in semiconductors and artificial intelligence intensifies.
English (US) ·