Mitsui, Kaynes and AOI Electronics collaborate to build semiconductor OSAT capabilities in India!
Mitsui & Co., Ltd has entered into a strategic partnership with Kaynes Semicon Private Limited and AOI Electronics Co., Ltd to support the development of semiconductor back-end manufacturing in India. The collaboration is focused on establishing strong Outsourced Semiconductor Assembly and Test (OSAT) capabilities that will contribute to India’s rapidly expanding semiconductor ecosystem.
Kaynes Semicon is currently building its capabilities in semiconductor assembly and testing, an important stage of chip manufacturing that takes place after wafer fabrication. The project aligns closely with the Government of India’s push to expand domestic semiconductor manufacturing under the Make in India initiative. The initiative includes financial incentives and policy support designed to attract global semiconductor investments and strengthen local production.
Under the partnership, Mitsui will play a strategic role in supporting the launch and development of Kaynes’ OSAT operations. AOI Electronics, one of Japan’s leading OSAT companies, will contribute technical expertise and operational experience in semiconductor back-end processing. This knowledge transfer is expected to help Kaynes establish production systems that meet global standards for quality, reliability and efficiency.
Mitsui will also support the commercialization of semiconductor products manufactured by Kaynes. As part of the agreement, the company has secured exclusive rights to manage procurement of raw materials sourced by Kaynes from Japanese-affiliated companies and suppliers outside India. This arrangement is intended to ensure stable sourcing of critical materials required for semiconductor packaging and testing.
In addition to procurement support, Mitsui will help build supplier partnerships both within India and internationally to ensure a resilient supply chain and smooth ramp-up of production. The agreement also includes provisions that allow Mitsui to acquire shares in Kaynes in the future, enabling the possibility of deeper strategic cooperation as the business expands.
Semiconductors have become essential components across modern industries including consumer electronics, automotive systems, telecommunications networks and artificial intelligence infrastructure. As demand for chips continues to grow, countries around the world are investing heavily in domestic semiconductor capabilities to reduce supply chain risks and strengthen technological independence.
By supporting Kaynes’ OSAT operations, Mitsui and AOI Electronics aim to help develop a stronger semiconductor manufacturing base in India while contributing to a more diversified and resilient global semiconductor supply chain.
