India opens CG Semi chip OSAT plant

Semiconductor packaging line in a new OSAT chip plant, illustrating India chip manufacturing expansion

Key Points

01Modi inaugurates CG Semi’s OSAT facility in Sanand, Gujarat
02Plant to start with about 200 million chips per year output
03India targets 500 million chips in nationwide annual production
04Rs 7,500–7,600 crore invested; capacity may scale sharply

Launch of CG Semi’s Sanand OSAT facility

Prime Minister Narendra Modi inaugurated the CG Semi Outsourced Semiconductor Assembly and Test (OSAT) facility in Sanand, Gujarat, on July 4, 2026, marking the beginning of commercial chip production at the site. The plant is operated by CG Semi, a unit of CG Power, and represents one of the early large-scale OSAT investments under India’s semiconductor programme. The inauguration signalled the transition of the project from construction to active manufacturing operations.

At the event, Modi said he had been told the Sanand facility would initially produce about 200 million semiconductor chips per year. This planned output positions the plant as a significant new source of chips for both domestic and overseas customers at the start of its operations.

Production capacity and national targets

Modi also outlined a broader objective for the country, stating that India has set a target of manufacturing 500 million chips annually. The initial 200 million chip capacity at Sanand is framed as a substantial contribution toward this nationwide goal. Reports further indicate that, once fully ramped, the CG Semi facility could scale to an annual capacity of up to about 5 billion chips, implying significant room for expansion beyond its starting level.

This potential scaling underscores the plant’s role in supporting India’s ambition to build a deeper presence in the global semiconductor value chain. The combination of an immediate production baseline and a much higher prospective ceiling illustrates how the facility is structured for phased growth.

Investment and technology scope

The Sanand OSAT plant has been developed with an investment of roughly Rs 7,500–7,600 crore. The facility is designed to provide assembly, packaging and testing services for semiconductor devices, rather than front-end wafer fabrication. Its focus is on chips used in automotive, industrial and other electronics applications, segments that require reliable and large-scale back-end processing capabilities.

These services are critical steps in the semiconductor supply chain, preparing chips for integration into end products. By concentrating on assembly and test, the plant addresses an important link in both domestic and international electronics manufacturing.

International partnerships and export reach

Coverage identifies the CG Semi project as a joint initiative that includes international partners such as Japan’s Renesas Electronics and Thailand’s Stars Microelectronics. Their involvement is positioned alongside CG Semi’s role as the operating unit under CG Power. This collaboration brings together local and overseas participants within a single OSAT platform in India.

Reports state that a portion of the Sanand facility’s production is intended for export to markets including Japan, the United States and Europe. Serving these destinations, in addition to domestic customers, aligns the plant with global demand in automotive and industrial electronics. The combination of export orientation, foreign partnerships and significant investment highlights the Sanand OSAT facility as a key element in India’s current semiconductor manufacturing drive.

Key Takeaways

01The Sanand OSAT launch marks a transition from project build-out to live chip production, giving India a new large-scale back-end semiconductor site.
02Initial capacity of about 200 million chips a year supports, but does not yet fulfill, India’s 500 million chip annual manufacturing target, leaving room for further expansion.
03The plant’s design, investment scale and potential ramp to about 5 billion chips a year position it as a strategic node in both domestic and export semiconductor supply chains.

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