India roundup: India state targets chip packaging hub as India courts Taiwanese electronics investment

Andhra Pradesh’s focus on assembly and test is a pragmatic bypass of the formidable barriers in wafer fabrication. This move will spur localized demand for backend equipment, substrate materials, and test software—but near-term reliance on mature-node support from Taiwan, China and Northeast Asia remains acute. Geopolitical pressures may accelerate capacity shifts by firms like TSMC and ASE, prompting countermeasures from Malaysia and Vietnam to defend their packaging hubs. However, subsidy races among Indian states risk fiscal strain, and weak power/logistics infrastructure could delay yield ramp timelines. Within 18 months, global OSAT capacity will experience regional misallocation: low-to-mid-end orders shift to India, while advanced AI packaging stays anchored in Taiwan, China and mainland China. The real long-tail impact hinges on whether India can leverage packaging as a gateway to catalyze a domestic chip design ecosystem.