Amid global competition to meet high-end chip demand, India’s Tata Group aims to expand domestic production capacity. 

The project was proposed in December 2021 with a total outlay of US$8.4Bn across Tata Electronics’ three approved facilities. The greenfield facility was approved by the Union Cabinet on 29 February 2024, and ground was broken on 5 August 2024 in Jagiroad, Assam. Tata Electronics, the wholly owned subsidiary of Tata Sons, expects the facility to begin production by mid-2025, with a daily production capacity of 48.3 million chips. The assembly and testing of semiconductor chips for automotive, communications, artificial intelligence (AI), and other applications will take place at the facility.

Amid geopolitical tensions between the West and East over semiconductor-related production flows, India has shown that it is capable of taking up a share of the market not heavily sought after by major industry players. This includes facilities, such as this one, focusing on an outsourced assembly and test (OSAT) model. The Assam Plant was approved under India’s flagship incentive programme, and the facility’s development is supported by the India Semiconductor Mission and the Government of Assam’s Electronics policy.

Notably, the facility will feature indigenous semiconductor packaging technologies, including Wire Bond, Flip Chip, and Integrated Systems Packaging (ISP), with plans for the facility to expand its packaging technologies in the future.

While India may not yet be able to compete for high-end chip manufacturing capabilities, the country is in a favourable position to build out its packaging and test facilities as demand for higher-performance chips increases across the board.

The new facility will also feed domestic demand for semiconductor applications, providing a cheaper alternative and further streamlining chip production toward creating an end-to-end semiconductor manufacturing ecosystem in India.