The computer chip industry in the United States is currently going through a phase whereby many companies are nurturing a growing pool of designers in Asia, especially India and China, and Eastern Europe, according to The Wall Street Journal.

An example of this trend is the way in which Naveed Sherwani, a former executive at Intel Corp. has set up a chip-design center in his native land, India, for his Silicon Valley start-up,Silicon Inc. According to Sherwani, the reason for setting up a start-up in India was not just to reduce cost, but also to increase the firm’s reliability and predictability.

Commenting about the latest shift in the chip industry, The Journal said the industry began moving labor-intensive assembly operations to Southeast Asia nearly 40 years ago. American chip firms, however, kept their control of many industry segments by designing key products at home, the daily added.

The development has been accompanied by the growing realization among industry executives that moving chip design abroad may not threaten the U.S. semiconductor industry. Most chips designed abroad, they say, have been relatively simple when compared with Intel’s flagship Pentium line. Sherwani and several other executives also believe that the spread of chip-design activity abroad is helping boost sales of U.S. technology firms by addressing talent shortages that slow the delivery of new products.

Walden Rhines, CEO of Wilsonville, Ore-based Mentor Graphics Corp., was quoted as saying that new engineering resources allow their worldwide business to grow, which helps them hire more people in the U.S.

The trend is still in its early stages, The Journal said. However, it is catching on, Rhines said, adding that mentor’s sales of chip-design software in China has tripled in two years, while India and Eastern Europe have grown a shade slower

Intel has aggressive plans for Bangalore, The Journal said, adding that the world’s no. 1 chip maker plans to expand its technical staff there from 900 at present to 2,000 by 2006. Rather than seeking to get them to work for low salaries, the strategy, an Intel spokesman was quoted as saying, was that the new design teams in India would help create new products.

“This is not India vs. the U.S. ---- this is India plus the U.S.,” according to Ketan Sampat, president of Intel’s Indian subsidiary.