CG Power launches semiconductor production in India with 200 million annual chip capacity

CG Power & Industrial Solutions just flipped the switch on India’s semiconductor ambitions. The company’s subsidiary, CG Semi, has begun commercial chip production at its Outsourced Semiconductor Assembly and Test facility in Sanand, Gujarat, with a capacity to churn out roughly 200 million chips per year.

That’s approximately 500,000 chips per day rolling off the G1 pilot line.

The deal behind the chips

CG Semi operates as a joint venture with CG Power holding the majority stake, alongside Japan’s Renesas Electronics and Thailand’s Stars Microelectronics. The total investment clocks in at around 7,600 crore rupees, roughly $900 million.

The facility focuses on assembly, packaging, and testing, covering chips destined for consumer electronics, automotive systems, industrial applications, and power management.

Prime Minister Narendra Modi is scheduled to formally inaugurate commercial production on July 4, 2026. Initial shipments are expected to begin around June 19, 2026, giving the facility a brief operational window before the ribbon-cutting ceremony.

Why this matters beyond India’s borders

India’s Semiconductor Mission, a government-backed initiative, has been the driving force behind projects like CG Semi’s Gujarat facility. The pilot line was first inaugurated in August 2025, and the transition to commercial production represents the mission’s first tangible output.

CG Power is already planning a G2 facility that targets approximately 14.5 million chips per day. That would represent a nearly 30x increase over the current G1 line’s daily capacity. The company aims to have this expansion operational by late 2026.

Beyond manufacturing scale, CG Power is diversifying into chip design and has been investing in AI-focused startups.

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