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South Korea will create a fund worth 300 billion won ($229.25 million) to ensure the stable value chain of the chip industry by strengthening the logic chip sector and related materials, parts and components firms, the industry ministry said on Monday.

Samsung Electronics and SK hynix vowed to invest a combined 75 billion won, and the Korea Development Bank, the Industrial Bank of Korea and several other entities will extend another 75 billion won of policy financing for a parent fund, according to the Ministry of Trade, Industry and Energy.

The remaining 150 billion won will come from private investors, it added. The largest-scale fund for the semiconductor industry is expected to be launched within this year, reports Yonhap news agency.

The fund, in particular, is aimed at supporting fabless companies and those making materials, components and equipment of the chip industry so as to strengthen the overall "ecosystem" of the industry, as they are struggling with raising funds amid the industry downcycle and recent interest rate hikes, according to the ministry.

The country launched the 240 billion-won fund in 2017 to spur industry growth and the separate one worth 120 billion won in 2020, and both are expected to run out around next year.

"This fund is expected to help make the South Korean version of Nvidia that will lead the country's chip industry. The government will continue to extend various supportive measures," First Vice Industry Minister Jang Young-jin said.

The semiconductor industry is the backbone of the country's economy, and the government has vowed all-out efforts to support the industry by easing regulations, offering greater incentives for investment and nurturing talent.

Earlier this year, the National Assembly passed a revision of the Act on Restriction of Special Taxation, also dubbed the K-Chips Act, which centers on expanding the tax credit rate for chipmakers.