India is taking a bigger step in the global chip race with Semicon India 2.0. The new Rs 1.27 lakh crore programme goes beyond building chip factories.
It aims to strengthen the entire semiconductor ecosystem. The plan covers chip design, manufacturing, packaging, research, materials and skilled talent. The Union Cabinet approved the programme on July 15. It builds on the progress made under the first phase launched in 2021.
The government wants India to become a globally competitive semiconductor hub. It also plans to reduce dependence on global supply chains. The latest programme focuses on every stage of the semiconductor value chain instead of only manufacturing chips.
The first Semicon India Programme was approved in December 2021. It came after the Covid-19 pandemic exposed global chip shortages. The initiative was implemented through the India Semiconductor Mission. It offered financial incentives to attract semiconductor investments.
Unlike earlier efforts, the first phase aimed to build a complete semiconductor ecosystem. It included chip design, fabrication, testing, packaging, logistics, specialty chemicals, industrial gases and skilled manpower.
The second phase takes this vision further. According to Electronics and IT Secretary S Krishnan, the focus has shifted from proving India's manufacturing capability to strengthening every part of the semiconductor value chain.
The programme is built around six major priorities:
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The first phase has already delivered visible results. India has approved 12 semiconductor manufacturing projects across Gujarat, Uttar Pradesh, Punjab, Assam, Odisha and Andhra Pradesh. These projects include one silicon fab, one silicon carbide fab, one gallium nitride micro LED display fab and nine packaging facilities.
The combined investment in these projects exceeds Rs 1.64 lakh crore. Commercial production has already started at facilities operated by Micron, Kaynes Semicon and CG Power. Another manufacturing unit is expected to begin production in 2026.
Tata is also developing a semiconductor facility in Dholera, Gujarat. The company has partnered with Dutch equipment maker ASML to manufacture 300mm wafers in India. This could support future production of advanced semiconductor chips.
India already holds nearly 20 percent of the world's semiconductor design talent.
Under the DLI Scheme, 24 startup and MSME projects have received financial support. Another 105 startups and MSMEs have gained access to industry-standard Electronic Design Automation tools. These companies are developing chips and Systems-on-Chip for commercial and strategic applications.
The government has also invested heavily in talent development.
Under the Chips to Startup programme, EDA tools have been introduced across 315 universities. Around 68,000 students have already received semiconductor training. The Semiconductor Laboratory in Mohali is also being upgraded to support chip designs developed by students and researchers.
Semicon India 2.0 plans to expand these efforts further. It will encourage industry participation in clean room training, fabrication technologies and advanced semiconductor manufacturing.
The government believes Semicon India 2.0 will accelerate economic growth while improving supply chain resilience. By expanding domestic capabilities across design, manufacturing, packaging and research, India hopes to emerge as one of the world's leading semiconductor destinations.
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