diff --git a/dockers/docker-orchagent/ipinip.json.j2 b/dockers/docker-orchagent/ipinip.json.j2
index 66bec75da7dc..d0eafb2206f1 100644
--- a/dockers/docker-orchagent/ipinip.json.j2
+++ b/dockers/docker-orchagent/ipinip.json.j2
@@ -2,12 +2,17 @@
 {% set ipv6_addresses = [] %}
 {% set ipv4_loopback_addresses = [] %}
 {% set ipv6_loopback_addresses = [] %}
+{% if DEVICE_METADATA['localhost']['sub_role'] == 'FrontEnd' or  DEVICE_METADATA['localhost']['sub_role'] == 'BackEnd'%}
+{% set loopback_intf_names = ['Loopback0', 'Loopback4096'] %}
+{% else %}
+{% set loopback_intf_names = ['Loopback0'] %}
+{% endif %}
 {% for (name, prefix) in LOOPBACK_INTERFACE|pfx_filter %}
-    {%- if prefix | ipv4 and name == 'Loopback0' %}
+    {%- if prefix | ipv4 and name in loopback_intf_names %}
         {%- set ipv4_addresses = ipv4_addresses.append(prefix) %}
         {%- set ipv4_loopback_addresses = ipv4_loopback_addresses.append(prefix) %}
     {%- endif %}
-    {%- if prefix | ipv6 and name == 'Loopback0' %}
+    {%- if prefix | ipv6 and name in loopback_intf_names   %}
         {%- set ipv6_addresses = ipv6_addresses.append(prefix) %}
         {%- set ipv6_loopback_addresses = ipv6_loopback_addresses.append(prefix) %}
     {%- endif %}
diff --git a/src/sonic-config-engine/tests/multi_npu_data/ipinip.json b/src/sonic-config-engine/tests/multi_npu_data/ipinip.json
new file mode 100644
index 000000000000..0f8396e63b30
--- /dev/null
+++ b/src/sonic-config-engine/tests/multi_npu_data/ipinip.json
@@ -0,0 +1,23 @@
+[
+    {
+        "TUNNEL_DECAP_TABLE:IPINIP_TUNNEL" : {
+            "tunnel_type":"IPINIP",
+            "dst_ip":"10.1.0.32,8.0.0.0,10.0.0.0,10.1.0.1,10.1.0.3",
+            "dscp_mode":"pipe",
+            "ecn_mode":"copy_from_outer",
+            "ttl_mode":"pipe"
+        },
+        "OP": "SET"
+    } 
+    ,
+    {
+        "TUNNEL_DECAP_TABLE:IPINIP_V6_TUNNEL" : {
+            "tunnel_type":"IPINIP",
+            "dst_ip":"fc00:1::32,fd00:1::32,fc00::1",
+            "dscp_mode":"pipe",
+            "ecn_mode":"copy_from_outer",
+            "ttl_mode":"pipe"
+        },
+        "OP": "SET"
+    }
+]
diff --git a/src/sonic-config-engine/tests/test_j2files.py b/src/sonic-config-engine/tests/test_j2files.py
index 583d7c55b701..db5c1cf3a91a 100644
--- a/src/sonic-config-engine/tests/test_j2files.py
+++ b/src/sonic-config-engine/tests/test_j2files.py
@@ -19,6 +19,8 @@ def setUp(self):
         self.mlnx_port_config = os.path.join(self.test_dir, 'sample-port-config-mlnx.ini')
         self.dell6100_t0_minigraph = os.path.join(self.test_dir, 'sample-dell-6100-t0-minigraph.xml')
         self.arista7050_t0_minigraph = os.path.join(self.test_dir, 'sample-arista-7050-t0-minigraph.xml')
+        self.multi_asic_minigraph = os.path.join(self.test_dir, 'multi_npu_data', 'sample-minigraph.xml')
+        self.multi_asic_port_config = os.path.join(self.test_dir, 'multi_npu_data', 'sample_port_config-0.ini')
         self.output_file = os.path.join(self.test_dir, 'output')
 
     def run_script(self, argument):
@@ -151,6 +153,14 @@ def test_buffers_dell6100_render_template(self):
         sample_output_file = os.path.join(self.test_dir, 'sample_output', 'buffers-dell6100.json')
         assert filecmp.cmp(sample_output_file, self.output_file)
 
+    def test_ipinip_multi_asic(self):
+        ipinip_file = os.path.join(self.test_dir, '..', '..', '..', 'dockers', 'docker-orchagent', 'ipinip.json.j2')
+        argument = '-m ' + self.multi_asic_minigraph + ' -p ' + self.multi_asic_port_config + ' -t ' + ipinip_file  +  ' -n asic0 '  + ' > ' + self.output_file
+        print(argument)
+        self.run_script(argument) 
+        sample_output_file = os.path.join(self.test_dir, 'multi_npu_data',  'ipinip.json')
+        assert filecmp.cmp(sample_output_file, self.output_file)
+
     def tearDown(self):
         try:
             os.remove(self.output_file)