India Opens Semiconductor Assembly Facility in Gujarat
Prime Minister Narendra Modi inaugurated a new outsourced semiconductor assembly and test (OSAT) facility in Sanand, Gujarat, on 4 July 2026, describing the project as an important step in India’s wider semiconductor strategy. According to the official government release, the facility is intended to strengthen domestic chip manufacturing capabilities, support technological self-reliance and deepen India’s role in the global semiconductor supply chain. The project forms part of the country’s broader effort to build an end-to-end electronics and semiconductor ecosystem. During the inauguration, Modi said the facility reflected India’s long-term policy focus on advanced technology manufacturing and local design capabilities. He noted that the country’s semiconductor expansion had developed from earlier investments in electronics manufacturing, including mobile devices and components. The Prime Minister’s Office, available through the official government website, said the initiative aligns with the national objective of expanding domestic production across the technology value chain. Semiconductor ecosystem continues to expand The Sanand facility is India’s third major semiconductor-related manufacturing project to begin commercial activity under the current programme. Modi said the development demonstrated the country’s ability to move projects from planning to production within a relatively short period. He noted that the foundation stone for the site had been laid in 2024 and that chip testing activities were expected to begin by August 2025. The Prime Minister also highlighted international industrial cooperation linked to the project, involving partners from India, Japan and Thailand. He described the collaboration as an example of cross-border technology partnerships that could help accelerate the growth of India’s semiconductor sector. The facility currently has an annual production capacity of 200 million units, with plans to scale output further in the coming years. Modi said semiconductor manufacturing clusters create wider economic activity by attracting suppliers, testing laboratories, design centres and start-ups. Linking semiconductor growth to electronics manufacturing In his address, Modi argued that India’s semiconductor ambitions are closely connected to the rapid growth of the domestic electronics industry over the past decade. He said the country had moved progressively from manufacturing finished products to developing components and now semiconductors. He cited growth in mobile phone manufacturing as an example of how industrial policy had evolved. According to the Prime Minister, India’s electronics production has increased significantly since 2014, while exports have also expanded. The government views semiconductor manufacturing as the next stage in building a more resilient technology supply chain. The wider policy framework has also been supported through recent budget measures and technology programmes aimed at AI and semiconductor development. Earlier reporting on India’s semiconductor and AI investment strategy highlighted the government’s intention to strengthen domestic manufacturing capacity alongside research and innovation. Focus on skills, research and supply chains Modi said India’s long-term objective is to develop a complete semiconductor ecosystem covering chip design, fabrication, packaging and advanced materials. He also emphasised the importance of securing supply chains for critical minerals and specialised manufacturing inputs. The Prime Minister linked semiconductor development to emerging sectors such as artificial intelligence, robotics and advanced computing. He said the expansion of the industry would create opportunities across research, design, engineering and supply chain management. The government has also placed increasing emphasis on workforce development to support the industry’s growth. Initiatives focused on next-generation chip design skills are intended to strengthen technical expertise and prepare young professionals for semiconductor-related roles. Modi highlighted the participation of young workers, including women from tribal communities, who had received technical training abroad before joining manufacturing operations at the facility. He said such programmes demonstrated how industrial expansion could support broader social and economic inclusion. Industrial clusters seen as central to future growth The Prime Minister compared the development of Sanand with established international technology clusters, arguing that semiconductor manufacturing requires integrated ecosystems rather than isolated factories. He referred to examples such as Silicon Valley and East Asian science parks to underline the role of concentrated industrial networks in driving innovation. India’s broader digital and communications strategy is also shaping demand for advanced semiconductor capabilities. Recent discussions on India’s 6G and telecom development plans highlighted the growing importance of domestic technology infrastructure and advanced electronics production. Concluding his address, Modi said India would continue to pursue policy reforms and ease-of-doing-business measures to support investment in advanced manufacturing. He added that semiconductor development would remain central to the country’s ambition of becoming a developed economy by 2047.
Source: OpenGov Asia