If you want to increase its internal memory, then you will need to use Link2SD but after you partition the SD card to EXT2 format. When you insert the newly formatted EXT2 SD card into the phone Link2SD will start. Select the AUTOLINK options then select Install Locations. Check External and reboot your phone. Now all the application will be installed onto the external partition which will act as internal storage.
The phone needs to be rooted before you can actually do this.