The Union Cabinet has approved seven major decisions with a combined outlay of ₹2,19,353 crore, covering semiconductor manufacturing, mobile phone production, fertiliser security and infrastructure development in Varanasi. The approvals were announced after a Cabinet meeting chaired by Prime Minister Narendra Modi.
The biggest allocation in the package has been approved for Semicon 2.0, the second phase of the India Semiconductor Mission, with an outlay of ₹1,27,500 crore. The initiative aims to strengthen India’s semiconductor ecosystem by supporting areas such as chip design, manufacturing and research. Officials expect the programme to attract around ₹4 lakh crore in total investment during its implementation period.
Along with Semicon 2.0, the Cabinet also approved the Mobile Phone Manufacturing Scheme (MPMS) with an outlay of ₹62,500 crore. The scheme aims to increase domestic mobile phone production, improve local value addition, support exports and strengthen India’s position in the global electronics manufacturing supply chain.
Union Minister Ashwini Vaishnaw said the decisions reflect the government’s continued efforts to reduce import dependence and position India as a key player in the global semiconductor supply chain. He added that the first phase of the India Semiconductor Mission had already resulted in approvals for multiple fabrication units, while Semicon 2.0 will expand support across the broader chip ecosystem.
The Cabinet also approved the National Investment Policy for Urea-2026 (NIPU-2026) to improve India’s fertiliser self-sufficiency. The policy aims to add nearly 10 million tonnes of annual domestic urea production capacity through seven to nine new gas-based plants over the next eight years.
India currently faces an annual urea production shortfall of around 10 million tonnes, which it meets through costly imports. The new policy includes reforms such as the separation of fixed and variable costs, a return on equity band of 12% to 16%, and an eight-year guaranteed buyback for new plants. The government estimates annual subsidy savings of more than ₹10,500 crore once the new capacity becomes operational.
The Cabinet has also approved two major elevated corridor projects in Varanasi, Prime Minister Narendra Modi’s parliamentary constituency. The projects, worth more than ₹25,445 crore, include the 43-km Varuna River Elevated Corridor and the 46-km Ganga River Elevated Corridor.
The two corridors will connect national highways with the Varanasi Ring Road and are expected to reduce travel time from around 60 minutes to nearly 20 minutes. They will also improve access to important locations, including pilgrimage sites such as the Kashi Vishwanath Temple. Both projects will be developed by the National Highways Authority of India (NHAI) under a hybrid annuity model.
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