India’s CG Semi Starts Commercial Chip Production at $870M Gujarat Plant
The Sanand Facility
The Sanand facility will package 200 million chips a year initially, with plans to scale to 500 million. This makes it the third packaging plant to come online under India’s Semiconductor Mission, following Micron and Kaynes Semicon.
Key Takeaways
- PM Modi inaugurated commercial production at CG Semi’s chip assembly and testing plant in Gujarat.
- The plant is an outsourced semiconductor assembly and test (OSAT) facility, covering packaging and testing.
- CG Semi is a joint venture between CG Power, Renesas Electronics, and Stars Microelectronics, investing INR 7,600 crore ($870M) over five years.
- The Indian government provides subsidies worth up to $404M through the India Semiconductor Mission.
- Chips produced in Sanand will be exported to Japan, the US, and Europe.
- The plant is expected to create 5,000 direct and indirect jobs over five years.
- Six semiconductor projects valued at $14.7bn have been approved in Gujarat, transforming Sanand into a chip packaging cluster.
Scalability and Capacity
At full ramp, CG Semi aims to produce 15 million units daily, equating to roughly 4.7 billion chips annually. The site will manufacture legacy packages like QFN and QFP, as well as advanced FC BGA and FC CSP formats for various industries, including automotive, consumer, industrial, and 5G.
India’s Strategic Move
The launch aligns with a broader strategic push by India. PM Modi has secured significant AI infrastructure commitments from global tech giants like Amazon, Google, and Reliance. India has also joined the US-led Pax Silica alliance on chip supply chains. Similar to other countries, India is prioritizing local chip capacity through subsidies and incentives in an escalating global race for technological supremacy.