How this OSAT in Gujarat is Developing the China+1 Alternative

When Prime Minister Narendra Modi called semiconductors as the future in his Independence Day address, it was more than symbolism. 

He said that India’s early attempts to establish semiconductor factories nearly five to six decades ago were, as many experts note, “killed at birth,” even as other nations went on to build thriving chip industries. 

Today, however, the country is in mission mode to develop a robust semiconductor ecosystem. By the end of 2025, India is expected to roll out its first Made-in-India semiconductor chips, a milestone that will highlight the nation’s growing capabilities in this critical technology sector.

The India Semiconductor Mission (ISM), launched in December 2021, is the government’s flagship initiative to position the country as a global hub for electronics. With a dedicated corpus of ₹76,000 crore (US$9.2 billion), the mission focuses on three key areas: semiconductor fabrication, display manufacturing, and chip design.

Traditionally, semiconductor manufacturing has been dominated by countries like Taiwan, South Korea, Japan, and the US. Asian peers such as Singapore, Malaysia, and especially China have built robust semiconductor ecosystems over decades. India, on the other hand, has excelled in semiconductor design, accounting for nearly 20–25% of the world’s design manpower  but lags significantly in manufacturing.

However, Gujarat is growing as a hub for semiconductor manufacturing.

Dholera, a planned industrial smart city and Special Investment Region in the state is at the forefront of this growth as it hosts top semiconductor companies like Micron Technology, Vedanta-Foxconn Joint Venture, Tata Electronics, STMicroelectronics and Intel India.

Talking to AIM, Shetal Mehta, founder at Suchi Semicon said that “Gujarat is actually becoming the hub of semiconductor manufacturing. Where the hub exists, talent, suppliers, and ecosystem players will naturally develop,” he explains. The state government’s incentives, ease of doing business, and its growing concentration of equipment vendors and training facilities are helping accelerate this shift.

Suchi Semicon, is a homegrown Outsourced Semiconductor Assembly and Test (OSAT) company, founded and run entirely by Indian entrepreneurs. 

Based in Surat, the company has started manufacturing and shipping devices to the United States. “We are the first company on Gujarat soil to start operations, manufacture a device, and actually ship it to the US,” Mehta said.

India’s China + 1 Moment

Geopolitics, trade wars, and supply chain shocks during the pandemic have forced multinational corporations to rethink their reliance on China. The “China + 1” strategy — diversifying supply chains to include at least one more country — has become a boardroom mandate.

Mehta sees this clearly on the ground. “Every company is now thinking that probably we should have 10–30% of our production outside China. Earlier no one thought of this risk. Today, India is being taken much more seriously as a trusted alternative,” he said.

“We are one of the few companies 100% founded and run by Indians, with no international partners. That gives us an edge when the government talks of indigenous manufacturing and technology,” Mehta noted about Suchi Semicon.

Suchi Semicon’s pilot line in Surat has a capacity of 1.3 lakh chips per day. For now, it is running sample batches for customers across the US, Europe, Japan, Singapore, and India, with mass manufacturing expected to follow customer qualifications.

Talent, often cited as India’s Achilles heel in semiconductors, is being addressed proactively. The company has tied up with engineering colleges, set up training programs, and even built a training room inside its factory. Hiring spans from ITI-trained technicians to PhDs from NITs. “At the moment we are not facing a problem. Over time, as colleges introduce semiconductor subjects, a major chunk of manpower will be ready,” Mehta asserted.

The government has partnered with 270 universities and equipped them with advanced semiconductor design tools to prepare talent, PIB reported. In 2025 alone, these tools recorded over 1.2 crore usages, leading to 20 chips designed by 17 institutions being fabricated at the Semi-Conductor Laboratory in Mohali.

Another challenge for semiconductor players globally has been raw material dependence on China. Suchi Semicon has consciously diversified, sourcing from Japan, Singapore, the US, and other countries. “None of the raw material that comes into my factory is from China. We have three suppliers for each product, spread across geographies,” Mehta emphasised.

The Road Ahead

Currently, the company employs about 70 people and is planning to expand manufacturing lines and customer engagements. While there are no immediate plans to set up in South India, the focus remains on scaling the Surat facility first.

For Mehta, the vision goes beyond India. “While we want to make in India, we also want to be globally recognised. When people hear about semiconductors, they think of Taiwan. We want Suchi Semicon to be recalled on the global stage as a leading packaging house,” he said.

As Gujarat doubles down on becoming the nucleus of India’s semiconductor ambitions, Suchi Semicon is positioning itself not just as a local champion but as part of the global rebalancing of supply chains. 

Meanwhile, IT minister Ashwini Vaishnaw said on August 28 the first Made-in-India chip will be produced at CG Semi’s OSAT pilot facility in Sanand. 

The G1 pilot line will produce 0.5 million chips daily for sectors like automobiles, electronics, and consumer devices, before scaling up to a full facility (G2) producing 14.5 million units per day by 2027. 

The plant is a joint venture between CG Power, Japan’s Renesas Electronics, and Thailand’s Stars Micro, with Jacobs as the turnkey contractor. Vaishnaw also reviewed progress at Micron, Kaynes Technology, and Tata’s facilities, all of which are setting up pilot lines, signaling India’s accelerating semiconductor push