PM Modi to launch Gujarat’s new chip facility as India accelerates semiconductor manufacturing push

Ahmedabad, July 3 (IANS) India’s semiconductor manufacturing push is set to take another step forward with the launch of commercial chip production at CG Semi’s Outsourced Semiconductor Assembly and Test (OSAT) facility in Sanand, Gujarat, on July 4.

The project, approved by the Union Cabinet in February 2024 under the India Semiconductor Mission, has been developed by CG Semi Pvt. Ltd., a subsidiary of CG Power and Industrial Solutions Limited, with an investment of Rs 7,500 crore.

The facility has been established through a partnership between CG Semi, Japan’s Renesas Electronics and Thailand’s Stars Microelectronics.

Following the launch of commercial production by PM Modi, semiconductor chips manufactured at the Sanand facility will be supplied to customers in India and overseas.

The OSAT facility forms a key part of India’s semiconductor value chain by carrying out the assembly, testing and packaging of semiconductor chips before they are delivered to end users.

The plant will manufacture legacy chip packages such as QFN and QFP, as well as advanced FC-BGA and FC-CSP packages, catering to industries including automotive, electronics, industrial equipment, 5G infrastructure and power applications.

The company currently employs more than 300 people and expects the project to generate around 5,000 direct and indirect employment opportunities over the next five years.

Construction of a second CG Semi plant is also under way, and together the two OSAT facilities are expected to produce a combined 1.5 crore chips per day.

The project further strengthens Sanand’s growing semiconductor ecosystem, following the commencement of operations at Micron Technology’s ATMP facility and Kaynes Semicon’s OSAT facility.

Once known primarily as an automobile manufacturing hub, Sanand is increasingly emerging as India’s first chip-packaging cluster and an important centre in the global semiconductor value chain.

PM Modi has described the country’s semiconductor drive as a defining phase for India’s technological future.

“Sanand has made a place for itself on the world map, synonymous with cutting-edge innovation and growth,” he said, adding that the commercial launch of the CG Semi facility would mark “a momentous occasion for India’s efforts in semiconductor manufacturing”.

He also said, “This decade will prove to be the biggest turning point in India’s tech future.”

Emphasising the broader vision behind the country’s semiconductor programme, PM Modi said: “Our objective is not limited to setting up just one factory, but to creating an entire ecosystem. India is now focusing on the entire semiconductor value chain, from design engineers to machine manufacturers and logistics. The announcement of India Semiconductor Mission 2.0 is a major step in this direction. As manufacturing grows, demand for materials and components within India will also increase, creating the biggest opportunity for domestic industries.”

Gujarat has emerged as a key destination under the India Semiconductor Mission and was the first state to announce a dedicated semiconductor policy for the sector.

Six semiconductor projects have so far been approved in the state, including Tata Electronics, Micron Technology, CG Semi, Kaynes Semicon, Suchi Semicon and Crystal Matrix, representing a combined investment of USD 14.7 billion.

The state government says Gujarat has developed a comprehensive semiconductor ecosystem extending beyond manufacturing to include design, packaging, supply chains, skill development, research, logistics and innovation.

It attributes this growth to dedicated policies, modern infrastructure, faster approvals and business-friendly governance aimed at attracting investment and supporting semiconductor production.

–IANS

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