Prime Minister Narendra Modi on Saturday laid the foundation stone and unveiled a plaque for ASIP Technologies’ semiconductor manufacturing facility at Tarluvada in Visakhapatnam. The Rs 2,500 crore outsourced semiconductor assembly and test (OSAT) project is Andhra Pradesh’s and South India’s first semiconductor manufacturing facility approved under the India Semiconductor Mission (ISM 1.0).
Andhra Pradesh Chief Minister N. Chandrababu Naidu joined the foundation stone ceremony virtually. The 30-acre facility, being established with an initial investment of more than Rs 460 crore, will have an annual production capacity of 96 million chips. South Korea-based APACT Co. is the project’s technology partner. The facility will serve high-growth sectors including artificial intelligence, high-performance computing, data centres and high-speed communications.
ASIP also plans to expand the facility with an additional investment of more than Rs 2,000 crore to scale up its advanced semiconductor packaging operations. The project is expected to create more than 1,000 direct high-skilled jobs and 1,600 indirect jobs. Once operational, ASIP will begin production using wire-bond and flip-chip ball grid array (BGA) packaging technologies, followed by the introduction of advanced 2.5D and 3D packaging capabilities within two to three years.
In his address, Modi commended Andhra Pradesh’s information technology talent pool and said the state was now well positioned to lead in semiconductor manufacturing. He said the government was committed to supporting this emerging manufacturing growth story, which he described as an important part of the Viksit Bharat mission.
Amitesh Kumar Sinha, chief executive officer of the India Semiconductor Mission, applauded ASIP for breaking ground on the project, calling it an important contribution to India’s semiconductor mission. Venkata Simhadri, managing director and chief executive officer of ASIP, said the groundbreaking marks a significant milestone for the company and its commitment to strengthening India’s semiconductor manufacturing capabilities, thanking the government, MeitY, ISM and the Andhra Pradesh government for their support.
Seong Dong Lee, chief executive officer and president of APACT, said the semiconductor industry is increasingly looking for resilient and diversified supply chains. “Our partnership with ASIP combines Korean technology expertise with India’s engineering talent and manufacturing ambition,” he said, adding that the facility will provide advanced packaging and testing solutions to customers globally.
India currently imports virtually all semiconductor chips used in its electronics industry. The OSAT facility addresses a critical gap in the country’s semiconductor value chain, where packaging and testing account for roughly 30-40 percent of chip manufacturing costs. The company expects to localise a significant portion of its supply chain over the next three to five years while building partnerships with academic institutions including IIT Tirupati and IIT Hyderabad.
The facility will also include an in-house semiconductor training centre aimed at developing a skilled workforce for India’s growing sector. Sustainability features such as solar power generation and water recycling systems will be integrated into the project, with the aim of establishing a high-standard, environmentally responsible manufacturing operation.
Sources: Business Standard, PM India