PM Modi Lays Foundation Stone for South India's First ISM-Approved Semiconductor Facility in Visakhapatnam

Prime Minister Narendra Modi on Friday virtually laid the foundation stone for ASIP Technologies' semiconductor manufacturing facility in Visakhapatnam, marking the launch of Andhra Pradesh's and South India's first semiconductor project approved under the India Semiconductor Mission (ISM 1.0).

The ₹2,500 crore Outsourced Semiconductor Assembly and Test (OSAT) facility, coming up on a 30-acre site at Tarluvada, is expected to strengthen India's semiconductor packaging and testing ecosystem while supporting high-growth sectors such as AI, high-performance computing, data centres and high-speed communications.

Andhra Pradesh Chief Minister N. Chandrababu Naidu joined the ceremony virtually. Senior government officials, including Amitesh Kumar Sinha, CEO of the India Semiconductor Mission (ISM), and Bhaskar Katamneni, Secretary, IT, Electronics & Communications, Government of Andhra Pradesh, were also present.

The project will begin operations with an initial investment of over ₹460 crore in partnership with South Korean semiconductor company APACT Co., which will serve as ASIP's technology partner. The facility is designed to manufacture up to 96 million chips annually and is expected to create more than 1,000 direct high-skilled jobs and 1,600 indirect jobs.

ASIP has also outlined plans to invest an additional ₹2,000 crore to expand its advanced semiconductor packaging capabilities in the coming years.

Addressing the event, Modi highlighted Andhra Pradesh's growing role in India's technology landscape.

"Andhra Pradesh's IT talent pool has already established itself in software, and now with the groundbreaking of this semiconductor manufacturing facility, the state is well poised to lead in the semiconductor manufacturing sector. The government is committed to backing this emerging manufacturing growth story, which is an important part of the Viksit Bharat mission," he stated.

The facility will initially offer wire-bond and Flip-Chip Ball Grid Array (BGA) packaging technologies, with plans to introduce advanced 2.5D and 3D packaging capabilities within the next two to three years.

Amitesh Kumar Sinha, CEO of ISM, said the project would contribute significantly to India's semiconductor ambitions.

"ASIP breaking ground today is an important contribution and step forward to further India's semiconductor mission, bringing an advanced semiconductor packaging facility to Visakhapatnam, Andhra Pradesh. We reaffirm our commitment to provide all support through growth-driven industry policies," he explained.

Industry executives said the project will help address a critical gap in India's semiconductor value chain. While India remains heavily dependent on imported chips, semiconductor packaging and testing account for nearly 30-40% of total chip manufacturing costs, making OSAT facilities strategically important for building domestic capabilities.

ASIP Managing Director and CEO Venkata Simhadri said the project represents a major milestone for the company and the country's semiconductor ecosystem.

"The groundbreaking of our Visakhapatnam facility marks a significant milestone for ASIP and our commitment to strengthening India's semiconductor manufacturing capabilities."

"We thank the Government of India, MeitY, the India Semiconductor Mission (ISM), and the Government of Andhra Pradesh for their support and confidence in this project. Together with our partner APACT, we are establishing advanced assembly, packaging and testing capabilities in India, while driving skill development, supply chain localisation, and contributing to the growth of Andhra Pradesh's semiconductor ecosystem."

APACT CEO and President Seong Dong Lee said the partnership combines Korean semiconductor expertise with India's manufacturing ambitions.

"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 "We believe this facility will become an important part of India's Semiconductor Mission and the global semiconductor ecosystem, providing advanced packaging and testing solutions to customers globally."

Beyond manufacturing, the company plans to localise a significant portion of its supply chain over the next three to five years and build partnerships with institutions such as IIT Tirupati and IIT Hyderabad. The facility will also house an in-house semiconductor training centre to support workforce development for the sector.

ASIP said sustainability will be a key focus of the project, with solar power generation and water recycling systems being integrated into the facility as part of its efforts to establish an environmentally responsible semiconductor manufacturing operation.