The first commercial semiconductor chip to be assembled in India will come out of CG Semi's outsourced semiconductor assembly and testing (OSAT) facility in Gujarat’s Sanand, IT Minister Ashwini Vaishnaw said Thursday. The chip will roll out from the company’s pilot line later this year. During his Independence Day speech, Prime Minister Narendra Modi had said that ‘made in India’ semiconductor chips will be available in the market by the end of 2025. “This pilot line will produce 500,000 chips per day, and our first made-in-India chip will come from here,” Vaishnaw said at a press conference in Gujarat , after the inauguration of the OSAT facility. This unit had received the Union Cabinet’s nod in February 2024, and will be set up with a total investment of Rs 7,600 crore. The facility is being set up as part of a joint venture between CG Power and Industrial Solutions, Renesas Electronics America and Thailand-based Stars Microelectronics. CG Power, Renesas and Stars are to invest, in one or more tranches, up to $205 million, $15 million and $2 million, respectively, as equity capital of the joint venture, which will represent around 92.34 per cent, 6.76 per cent and 0.9 per cent, respectively. It will assemble chips for consumer, industrial, automotive and power applications, and at its peak will have a production capacity of 15 million chips per day. It is worth noting that CG Semi’s proposal received the Cabinet’s approval in February 2024, more than seven months after the US-based Micron Technologies received the Cabinet’s nod in June 2023. Despite the later approval, it is CG Semi, which has managed to produce the first commercial chip in the country. Micron was the first company to have received the government’s approval for financial incentives under its ambitious Rs 76,000 crore India Semiconductor Mission. However, Micron is also first constructing a pilot line before a full scale facility, and its pilot line is of much larger magnitude compared to CG Semi’s, and could see first production in December 2025. OSAT facilities offer third-party packaging and test services, along with packaging silicon devices that are manufactured by foundries and provide testing devices before shipping to the market. Earlier this month, the Union Cabinet cleared four new semiconductor assembly and testing plants under its India Semiconductor Mission, which have a total financial outlay of Rs 4,594 crore. With these, the government is now offering financial incentives for the construction of a total of 10 chip-related factories, ranging from a fabrication plant to assembly and testing operations. This includes the Tata-PSMC fab, being built at a cost of roughly $11 billion, along with assembly and testing plants by US-based Micron Technology, the Tatas, Murugappa Group’s CG Power, Kaynes Semicon, and HCL-Foxconn. 1-million talent shortage by 2032 Vaishnaw also said that there will be a shortage of about 1 million semiconductor talents in the world by 2023 and Indians can fill that gap. He said the major objective of the semiconductor mission is to develop a talent pool for the world. About the progress in other chip plants in the state, he said, "I visited the nearby Micron's plant, and the construction is going on at a very good pace. At Kaynes plant, construction is going on at a very good pace. And a few months ago, I visited Dholera, there also, the construction is going on at a good pace." With inputs from Ahmedabad
