Paras Defence and Space Technologies is pushing deeper into semiconductors with a planned advanced chip packaging and testing facility in Madhya Pradesh, marking a major expansion beyond its core defence business.
Its semiconductor arm, Paras Semiconductors, has signed a memorandum of understanding with the Madhya Pradesh State Electronics Development Corporation to develop the greenfield OSAT project in the Indore Ujjain corridor. The proposed investment is about Rs 6,200 crore, or roughly $644 million, and the state has allotted 50 acres for the unit.
The facility is expected to focus on advanced packaging technologies including 2.5D and 3D integration, hybrid bonding, chiplet integration, wafer bumping and flip chip assembly.
These capabilities place OSAT units at a critical stage of semiconductor production, where chips are assembled, packaged and tested before they move into commercial use.
Paras Defence said the plant will support semiconductor devices for sensor technologies, optical and optronic systems, and other strategic applications, with room to expand into AI chips as demand evolves. The project is also aligned with India’s semiconductor push under the India Semiconductor Mission.
The move signals how Indian defence-linked companies are increasingly looking at semiconductors as a long-term growth area, especially in packaging and testing, which remain important 
gaps in the domestic supply chain. If executed as planned, the facility could strengthen both local manufacturing capacity and the wider ecosystem in central India.
The company has not disclosed a timeline for commissioning, and the project will still need to move through the usual execution and regulatory stages. Even so, the announcement marks an important diversification for Paras Defence and a fresh signal that India’s semiconductor story is expanding beyond fabs and into packaging infrastructure.
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