Tata Electronics Bhoomi Poojan for semiconductor assembly plant in Assam; operations in 2025

Tata Electronics, the greenfield venture of Tata Group specialising in the manufacturing of precision components, performed the traditional Bhoomi Poojan ceremony for its semiconductor assembly and testing unit in Jagiroad, Assam. The ceremony was attended by Himanta Biswa Sarma, Chief Minister of Assam, and N. Chandrasekaran, Chairman of Tata Sons. Earlier this year, on March 13, Prime Minister Narendra Modi virtually inaugurated Tata Electronics' fabrication plant in Dholera, Gujarat, as well as the OSAT (Outsourced Semiconductor Assembly and Test) plant in Assam.

In the semiconductor ecosystem, ATMP (Assembly, Testing, Marking, and Packaging) or OSAT (Outsourced Semiconductor Assembly and Test) facilities handle the critical tasks of assembling, testing, and packaging semiconductor chips. After chips are made at foundries, these facilities ensure they are properly prepared and checked before being shipped for use in electronic devices. 

To leverage the government of India’s semiconductor and display incentive scheme — announced in December 2021 with a financial outlay of ₹76,000 crore — Tata Electronics is establishing India’s first high-tech chip manufacturing plant in the Special Industrial Region of Dholera. This venture, in collaboration with Taiwan’s Powerchip Semiconductor Manufacturing Corp, involves a projected investment of ₹91,000 crore, with 50% of this amount subsidised by the central government. The plant, which will have a monthly production capacity of 50,000 wafers, is set to produce advanced chips for various sectors, including electric vehicles, telecommunications, defence, automotive, consumer electronics, display technologies, and power electronics.

In addition, to establish a comprehensive semiconductor ecosystem in India, Tata Electronics is also setting up a testing and packaging facility in Assam, Tata Semiconductor Assembly and Test Pvt Ltd (TSAT). With an investment of ₹27,000 crore, this facility is expected to achieve a production capacity of 48 million chips per day. TSAT Semiconductor will develop advanced indigenous packaging technologies, including flip chip and Integrated System in Package (ISIP) technologies. The plant will serve various sectors, including automotive, electric vehicles, consumer electronics, telecommunications, and mobile phones. This initiative is projected to create over 27,000 direct and indirect jobs in the region.

“Semiconductor chips are going to be fundamental to the future of every industry, be it electronics, telephony, consumer goods, automotive, or modern healthcare devices. Whatever you want to do, chips are going to be fundamentally essential. And every nation around the world is building capabilities, to build self-reliance and capability and be part of the global supply chain ecosystem. We believe that this is the future and important for India, and important for our people in terms of the knowledge base we need to create for the future,” says N Chandrasekaran, Chairman of Tata Sons at the Bhoomi Poojan ceremony.

“Tata Group has taken a holistic view, unique positioning in the entire value chain of the electronics ecosystem. We started by setting up a very strong manufacturing capability in Tamil Nadu, followed by a strong packaging capability in Karnataka. Then we are setting up an advanced chip manufacturing facility in Gujarat and an advanced chip test and assembly facility here in Assam.  With this, we will be adding an additional capability to design chips for any industry and global players. The chips that are packaged here in Assam will power EVs, mobile phones, health care devices of leading global companies around the world,” he adds.|

“The world’s top 5 OSAT players, i.e. ASE (Taiwan), Amkor (USA), Tongfu (China), JCET (China), King Yuan (Taiwan), and, Powertech (Taiwan) all combined have over $3.44 billion  (₹28,000 crore approx.) Capital expenditure allocated for 2024 and similarly TSMC currently has the world's most aggressive Capex allocation in the semiconductor industry has allocated $3.4 billion Capital Expenditure for Packaging units in 2024. Assam’s investment competes at the global scale. Thus, Tata’s $3.3 billion – ₹27,000 crore (over project construction and qualification) mega OSAT project investment competes at the global scale,” says Danish Faruqui, CEO, Fab Economics, the US-based boutique semiconductor Fab/ATMP/OSAT Greenfield projects advisory. 

The worldwide packaging market across all business models is estimated around $105 billion cumulative of Advanced Packaging and Legacy Packaging architectures in 2024 and is expected to grow cumulatively at a CAGR of 8.6% through 2030, as per Fab Economics. Currently, Legacy Packaging holds around 60% of the market share, which is the type of packaging to be produced in Tata’s Assam OSAT. However, by 2027, Advanced Packaging share will exceed that of Legacy Packaging for the first time. Across the Advanced Packaging and Legacy Packaging landscape, individual CAGR of different packaging architectures ranges from 6% to 53%.

Tata Electronics is accelerating the construction and hopes to complete the construction of one of the facilities in 2025 and commence operations. “Once this facility expands, it will bring the entire semiconductor ecosystem companies. We will need several people who will produce different components. I see a big corridor and ecosystem of many many companies developing here, which we will get to see in the coming years and become a thriving electronics hub,” says N Chandrasekaran.