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New Delhi: The Prime Minister, Narendra Modi, has inaugurated a key project for the semiconductor industry in India: the CG Semi Outsourced Semiconductor Assembly and Test (OSAT) facility at Sanand, Gujarat, and its territory is another positive milestone in India’s progress towards becoming a semiconductor manufacturing powerhouse around the world. Now, on a commercial basis, the plant is India’s third semiconductor production plant to open in 2026.
The new facility is part of several government initiatives, including “Make in India” and “Design in India” to establish a full-scale semiconductor ecosystem. The Prime Minister said that India is progressing from making electronics to building its semiconductor industry, which will aid future technologies like Artificial Intelligence (AI), Robotics, and Computing.
It is a project that has been developed by CG Semi in collaboration with Japan-based Renesas Electronics and Thai firm Stars Microelectronics with a net investment of over ₹7,600 crore. The foundation stone was laid in March 2024, and the establishment of the chip testing began in August 2025, while commercial production started in July 2026, taking approximately two and a half years to complete in total.
The Sanand plant will initially have the capacity to produce around 20 crore semiconductor units every year. The firm is also set to step up its manufacturing in the near future. The production of these chips will be destined for use in cars and electric scooters, in industrial equipment, and in other electronics products. Some will also be sent to such nations as Japan, the U.S., and several European countries.
In his speech made at the event, Prime Minister Modi emphasized the importance of having a robust ecosystem of the semiconductor industry and not a single factory. He said that Sanand is progressively transforming into a semiconductor district like esteemed foreign technology centers. Already established are leading semiconductor manufacturers; in the coming years, additional companies that design, test, use chemicals, or have other roles within the semiconductor industry will be expected to locate there.
Ashwini Vaishnaw, Cabinet Minister for Communications & IT, told AIKEN that India has achieved tremendous strides in the semiconductor industry. India has approved 12 projects in semiconductors so far of which three projects are already in commercial production, he said. The government is hoping to have five semiconductor plants operational by the end of 2026, with two more to be operational soon.
It is also likely to generate jobs in various Indian states. There are many engineers, technicians, and operators who have been trained in a specialized manner, including overseas training in Malaysia, to prepare them to work in semiconductor manufacturing. With the semiconductor ecosystem developing in India, it’s likely it’ll be happening even here.
Industry experts say that the beginning of commercial production of semiconductors at the CG Semi plant is an important step for India’s ambition to manufacture semiconductors. It indicated that projects that are being announced through the government’s semiconductor program are now entering the large-scale production stage from the planning stage. The plant is anticipated to boost India’s competitiveness in the global semiconductor supply chain and contribute significantly to the vision of making India a significant hub for electronics manufacturing and chip production for the future.
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