Govt Nears Full Allocation of Chip Production Fund, Space for Few

India has made significant progress in its ambitious semiconductor manufacturing strategy after nearly all the incentive funding has been allocated. The government has cleared around 62,900 crores out of 65,000 crores which are allocated to production of semiconductor, thus proving industry traction.

The Secretary of Electronics and IT, S Krishnan, said in a briefing on the upcoming Semicon India 2025 event that funds are limited to fund new proposals. “Out of this ₹65,000 crore, I think we have committed close to ₹62,900 crore or so already. We have limited funding, which we have available; we might be able to just accommodate two or three small projects,” Krishnan said.

The semiconductor mission has an overall outlay of 76,000 crore and was set up to leverage the Indian context in the global chip ecosystem. Out of this, 65,000 crores were provided as a chip manufacturing fund, 10,000 crores as reimbursement of Semiconductor Laboratory in Mohali and 1000 crores as a scheme on design linked incentives.

The fact that the funds were used in this way is also regarded by industry experts as a clear indication of investor confidence and fast track to the establishment of India as a semiconductor hub. But as projects move forward, there will be less money and projects may need to tap some other form of financing.

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In the pipeline, there is also the focus on the Semicon India 2025 event, set to be held between 2 and 4 September at Yashobhoomi in New Delhi. The event is projected to attract the representation of delegates in 33 countries, as well as over 50 senior executives in semiconductor world-leading companies.

This conference is expected to strengthen India's strategic attempt to become a reliable location for semiconductor design and production worldwide.