Union Cabinet's approval a shot in arm to create semicon ecosystem in AP

Andhra Pradesh Semiconductor and Display Fab Policy (4.)) envisaging transforming the State into a hub for Outsourced Semiconductor Assembly (OSAT) and Assembly Testing, Marking and Packing (ATMP) appears to have received a shot in the arm with the Centre deciding to locate one of the three manufacturing projects declared under the India Semiconductor Mission (ISM).

Many members of Confederation of Indian Industry (CII) , AP Chamber of Commerce and Industry Federation, AP Digital Technology Industry (APDTI) Network and Rushikonda IT Parks Association (RITPA) feel that there is a serious attempt to foster a complete semiconductor ecosystem including OSAT and ATMP.. Under the policy, Component Manufacturing Clusters (CMC) are planned in Visakhapatnam, Tirupati, Anantapur, Kopparthy and Nellore.

AP has already made a headway in signing an MoU with Yitoa Micro Technology Limited (YMTL) to set up India's first private semiconductor manufacturing park with an investment of over ₹.14,000 crore in Orvakal Industrial Park in Kurnool district. The cutting edge facility is expected to give a fillip to Silicon Carbide (SIC) chips enabling technology advancement and meeting sustainability goals.

Electronic Industries Association of India (ELCINA) opined that the new projects will be transformative at both the national and State levels, driving India towards a self-reliant, globally competitive semiconductor ecosystem and the target of $500 billion electronics production by 2030.

The association lauded the Union Cabinet’s approval of four new semiconductor manufacturing projects under ISM with cumulative investment of approximately ₹4,600 crore. These projects significantly expand India’s capabilities in compound semiconductors, advanced packaging, and high-power discrete devices, strategically strengthening the semiconductor ecosystem across AP, Odisha and Punjab.

Dr. Sasikumar Gendham, President of ELCINA and Managing Director, Awesense Five, hailed the announcement: “These approvals represent a giant leap forward in India’s semiconductor journey. For the first time, we will see commercial production of compound semiconductors and advanced glass substrate packaging on Indian soil, reducing critical import dependencies. The combination of cutting-edge technologies and strong domestic manufacturing will position India as a serious contender in the global semiconductor market. ELCINA is committed to supporting these pathbreaking projects to ensure their timely execution and integration into our broader electronics ecosystem.”

According to an assessment by ELCINA, with these approvals, the total number of ISM-supported projects rises to 10 across six states, representing cumulative investments of around ₹1.60 lakh crore. The newly approved facilities are expected to directly create over 2,000 skilled jobs, along with

significant indirect employment, thereby catalyzing electronics manufacturing growth nationwide.

Strategic State-Level Impact:

On prospects in AP, ELCINA stated that the semiconductor manufacturing unit for System-n-Package (SIP) solutions by ASIP Technologies (with APACT Co. Ltd., South Korea) is expected to integrate the State into the advanced packaging and assembly value chain, supporting India’s growing electronics demand. Odisha and Punjab are likely to emerge as the hubs with several key projects in the pipeline.

ELCINA Secretary General Rajoo Goel underscored the strategic importance: of the Union Cabinet’s decision to accelerate the diversification and deepening of India’s semiconductor capabilities. Beyond silicon-based technologies, the entry into SiC devices, advanced interposers, and high-power discrete semiconductors opens new opportunities in EVs, defence, telecom, and renewable energy. He said "this complements our world-class chip design talent and the Government’s sustained investment in skills. With over 60,000 students already trained under ISM talent programmes, we are building both the infrastructure and human capital needed for long-term growth.”