India Launches Major OSAT Facility for Semiconductor in Gujarat
In a landmark development, India has inaugurated one of its first full-scale Outsourced Semiconductor Assembly and Test (OSAT) facilities in Sanand, Gujarat. The facility, developed by CG Semi, was officially launched by Union IT Minister Shri Ashwini Vaishnaw and Gujarat Chief Minister Shri Bhupendra Patel in August 2025.
This milestone marks a huge step forward in India’s ambitious semiconductor roadmap, strengthening the vision of Atmanirbhar Bharat (self-reliant India) and establishing the country as a global semiconductor hub in the coming years.
With semiconductor chips being the backbone of modern electronics—used in smartphones, cars, defense systems, medical devices, and artificial intelligence—the new OSAT facility places India at the center of the global tech revolution.
What is an OSAT Facility?
Before diving into India’s achievement, it is important to understand what an OSAT facility actually does.
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OSAT stands for Outsourced Semiconductor Assembly and Test.
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These facilities specialize in assembling, packaging, and testing chips after they are designed and manufactured.
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It is a critical downstream step in the semiconductor supply chain.
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OSAT facilities ensure that chips are ready for integration into consumer and industrial products.
In short, while semiconductor fabs (fabrication units) manufacture chips, OSAT facilities make those chips usable and reliable in real-world products.
India’s launch of this OSAT facility bridges a vital gap in its semiconductor ecosystem, helping the country move closer to self-reliance in electronics.
The India Semiconductor Mission (ISM)
The launch of CG Semi’s OSAT facility is one of the biggest achievements under the India Semiconductor Mission (ISM)—a government initiative to build a strong semiconductor ecosystem.
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The ISM aims to position India as a global manufacturing and talent hub for semiconductors.
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So far, the government has approved ten semiconductor projects across different states.
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These projects cover chip design, fabrication, assembly, and testing, ensuring end-to-end capacity building.
The OSAT facility in Gujarat is particularly important because it not only supports domestic demand but also gives India the chance to enter the global semiconductor supply chain, which is currently dominated by countries like Taiwan, South Korea, and the USA.
Why Gujarat? The Emerging Silicon State
Gujarat has emerged as the epicenter of India’s semiconductor revolution. With strong government support, world-class infrastructure, and investor-friendly policies, the state has become the top choice for high-tech industries.
CG Semi has committed over ₹7,600 crore (USD 870 million) for its OSAT project in Gujarat.
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Two plants planned:
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G1 facility – inaugurated in 2025, with a daily capacity of 0.5 million units.
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G2 facility – under construction, expected to process 14.5 million units daily by 2026.
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Job creation: Together, both plants will generate over 5,000 direct and indirect jobs, boosting employment and skill development.
With such large-scale investments, Gujarat is fast becoming India’s very own “Silicon Valley”, attracting global partnerships and cutting-edge technology.
Addressing the Global Semiconductor Talent Gap
The semiconductor industry is not just about machines and plants—it’s about skilled people who design, build, and test chips.
According to industry estimates, the world could face a shortage of one million semiconductor professionals by 2032. To address this, India is taking proactive steps:
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The government has partnered with 270 universities to integrate semiconductor education and research.
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Over 1.2 crore usages of semiconductor design tools were recorded in 2025 alone.
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Already, 20 student-designed chips from 17 universities have been fabricated at the Semi-Conductor Laboratory (SCL), Mohali.
This ensures that India will not only manufacture chips but also train the world’s largest semiconductor talent pool, supplying skilled engineers and scientists for decades to come.
Global Industry Collaboration
One of the most significant aspects of this project is the global collaboration behind it. CG Semi is a joint venture involving:
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CG Power and Industrial Solutions (Murugappa Group) – India
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Renesas Electronics – Japan
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Stars Microelectronics – Thailand
This partnership brings together India’s industrial base with Japan’s semiconductor expertise and Thailand’s manufacturing experience.
Additionally:
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Indian engineers and technicians were trained in Malaysia, gaining hands-on experience in advanced OSAT processes.
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The plant includes high-yield equipment, automation systems, and reliability labs, ensuring world-class output.
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ISO 9001 and IATF 16949 certifications are already underway, with customer qualification runs starting soon.
Such international partnerships will help India build a globally competitive semiconductor ecosystem.
Importance of OSAT Facility for India
Launching an OSAT facility might sound technical, but it has direct benefits for India:
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Self-Reliance: Reduces dependence on foreign countries for chip testing and packaging.
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Economic Growth: Positions India in the global supply chain, boosting exports.
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Job Creation: Thousands of new opportunities in engineering, manufacturing, and research.
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Technology Sovereignty: Critical for defense, AI, and advanced electronics.
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Innovation: Encourages start-ups and academic institutions to develop chip solutions.
By investing in semiconductors, India is securing its future in technology, much like it did with IT services two decades ago.
Looking Ahead: India’s Semiconductor Future
The OSAT facility in Gujarat is just the beginning. India is aiming for a full-stack semiconductor ecosystem—from chip design to fabrication, packaging, and testing.
If successful, India will:
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Become a key global player in the $1 trillion semiconductor industry projected by 2030.
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Export chips worldwide, reducing the global dependence on a few Asian economies.
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Develop a sustainable semiconductor talent base, fueling both domestic and international demand.
With strong government policies, global partnerships, and a massive pool of young talent, India’s semiconductor story is shaping up to be one of the most transformative journeys of the decade.
Conclusion
The inauguration of the OSAT facility in Sanand, Gujarat is more than just a new industrial plant—it is a strategic milestone in India’s quest for self-reliance, technological sovereignty, and global leadership in semiconductors.
By bridging critical gaps in the semiconductor supply chain, empowering universities, and building partnerships with global players, India is well on its way to becoming both a production hub and a talent hub for the semiconductor industry.
The next few years will determine how fast India can scale up its efforts, but the direction is clear—India is preparing to lead the semiconductor revolution of the future.
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