Paras Semiconductor plans ₹6,200 crore OSAT facility in Madhya Pradesh

Paras Semiconductors, the semiconductor arm of Paras Defence & Space Technologies, plans to invest ₹6,200 crore to establish an outsourced semiconductor assembly and test (OSAT) facility in Madhya Pradesh, marking one of the state's largest proposed investments in semiconductor manufacturing as India expands its domestic chip ecosystem.

The proposed facility will come up on a 50-acre site allotted by the Madhya Pradesh government on the Ujjain–Indore Corridor, a region the state is positioning as a hub for semiconductor, electronics and advanced manufacturing industries.

The project is expected to strengthen India's semiconductor packaging capabilities for strategic and high-performance applications, while creating employment, supporting ancillary industries and building a broader supplier ecosystem.

Paras Semiconductors said the facility will initially focus on advanced semiconductor packaging technologies for sensor devices, optical and optronic systems, and other strategic applications. The company also sees the project creating opportunities to expand into AI chips and other advanced semiconductor technologies as demand evolves.

The investment comes as India accelerates efforts to build a domestic semiconductor value chain under the India Semiconductor Mission, with increasing focus not only on fabrication but also on assembly, packaging, testing, design and electronics manufacturing.

"The next phase of India's semiconductor journey will be defined not just by manufacturing capacity, but by the strength of the ecosystems we build around it," said Santosh Kumar, chief executive officer of Paras Semiconductors. He added that the Ujjain–Indore Corridor provides the infrastructure and policy support required to develop a globally competitive semiconductor ecosystem.

The company said the project builds on Paras Defence's expertise in optics and optronics and represents its strategic expansion into semiconductor manufacturing for critical technologies.

Munjal Sharad Shah, managing director of Paras Defence & Space Technologies, said the investment would contribute to indigenous semiconductor capabilities while supporting high-value manufacturing, employment generation and technology development.

The project aligns with Madhya Pradesh's Semiconductor Policy 2025, under which the state is seeking investments across semiconductor manufacturing, electronics, artificial intelligence, data centres and related industries. The government expects the corridor to emerge as a key destination for next-generation manufacturing supported by industry-academia collaboration, research infrastructure and skill development initiatives.

Chief Minister Mohan Yadav said the proposed investment reinforces the state's ambition to become a preferred destination for high-technology manufacturing, adding that the government would continue to provide policy support and infrastructure for semiconductor and strategic technology investments.

Industry experts view OSAT facilities as a critical component of India's semiconductor ambitions, helping reduce dependence on overseas packaging and testing while complementing investments in chip design, electronics manufacturing and future fabrication capabilities.

For Paras Semiconductors, the proposed investment marks a significant diversification beyond defence electronics into semiconductor manufacturing, positioning the company to address demand from strategic sectors while creating a platform for future expansion into emerging semiconductor applications, including AI-driven computing.