The Expenditure Finance Committee (EFC) under the Ministry of Finance has cleared a proposed outlay of INR 1.25 lakh crore for the India Semiconductor Mission (ISM) 2.0. The proposal is now awaiting final approval from the Union Cabinet and is aimed at expanding India’s semiconductor ecosystem and strengthening domestic chip manufacturing.
India has taken another step towards building a stronger semiconductor industry after the Expenditure Finance Committee (EFC) approved a proposed budget of INR 1.25 lakh crore for the India Semiconductor Mission (ISM) 2.0. The next phase of the mission, announced in the Union Budget 2026–27, is now awaiting the Union Cabinet’s final approval.
The proposed allocation is significantly higher than the INR 76,000 crore approved under the first phase of the mission. While ISM 1.0 focused on setting up semiconductor manufacturing and design facilities, the second phase aims to strengthen the broader ecosystem by supporting semiconductor equipment, materials, industrial gases, specialty chemicals, capital equipment manufacturers, MSMEs, indigenous intellectual property (IP), talent development, and other ecosystem partners.
The government expects the expanded programme to help India meet up to 75% of its domestic semiconductor demand by 2030. It is also expected to reduce dependence on imports and strengthen the country’s position as a global electronics manufacturing hub.
So far, the government has approved 12 semiconductor projects with a total investment pipeline of around INR 1.64 lakh crore. These include one semiconductor fabrication unit, two compound semiconductor fabrication units, and nine semiconductor packaging facilities. Two of these projects have already begun commercial production.
India has also continued to expand its chip design capabilities through the Design-Linked Incentive (DLI) Scheme. Under the programme, 24 projects are receiving financial support, while 23 design tape-outs have been completed across different foundries, including those using advanced technology nodes. In addition, 105 companies have been provided access to advanced chip design tools, reflecting the country’s growing expertise in semiconductor design.
Earlier, Union Minister for Electronics and IT Ashwini Vaishnaw had said that India Semiconductor Mission 2.0 would focus on developing domestic chip design and manufacturing capabilities, building a skilled talent pool, and attracting more ecosystem partners.
A senior official from the IT Ministry described India’s progress in semiconductor manufacturing as a “long-time dream” and said the country is emerging as an important player in the global technology ecosystem and is increasingly becoming “a voice to reckon with” in setting technology standards.
The official added that CG Semi is expected to be inaugurated on July 4, while one or two more semiconductor projects are likely to begin operations before the end of the year. More semiconductor projects are also expected to be announced in the coming months.
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