The Dutch government has invested €20m into Eindhoven company Smart Photonics to make sure the technology stays in the Netherlands, junior economic affairs minister Mona Keijzer has confirmed to MPs.

The company produces chips which work on the basis of light rather than electricity, which means they can process data more quickly and use less energy. The investment will allow the company to scale up production, the company said in a statement.

Smart Photonics had been looking for investment since last year and that there was interest from Asia, the Financieele Dagblad reported earlier.

Keijzer told MPs she had been made aware of the foreign interest at the end of last year and decided to invest directly in the company to make sure it, and its suppliers, remain in the Netherlands.

The action also fits in with European Commission call on member states to act against ‘undesirable developments’ in certain markets. Phototonic chips are considered a strategic key industry by Brussels.

In total, Smart Photonic has raised €35m to €40m, some of which has also come from KPN.

‘There is a need for a new generation of photonic integrated circuits that can transport data faster, be cost-effective and more sustainable, in order to keep up with the immense amount of data generated at a very high speed by advancing technologies like IoT, AI, augmented reality and autonomous driving,’ said Samir Ahmad, head of investment at KPN Ventures.