{"id":455,"date":"2026-09-01T17:25:00","date_gmt":"2026-09-01T11:55:00","guid":{"rendered":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/?p=455"},"modified":"2026-09-01T17:04:50","modified_gmt":"2026-09-01T11:34:50","slug":"semicon-2-0-allocates-rs-1-27-lakh-crore-to-build-indias-semiconductor-ecosystem","status":"publish","type":"post","link":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/news\/semicon-2-0-allocates-rs-1-27-lakh-crore-to-build-indias-semiconductor-ecosystem\/","title":{"rendered":"Semicon 2.0 Allocates Rs 1.27 Lakh Crore to Build India\u2019s Semiconductor Ecosystem"},"content":{"rendered":"\n

The new scheme lowers fabrication subsidies but expands support to semiconductor equipment, materials, research, design and talent development.<\/em> The government has notified the Rs 1,27,500-crore Semicon 2.0 scheme, expanding its focus beyond semiconductor fabrication to the wider chip manufacturing and supply chain ecosystem.<\/p>\n\n\n\n

The new programme reduces the capital subsidy available to semiconductor fabrication plants while introducing financial support for equipment, chemicals, gases and raw materials manufacturing for the first time. The scheme also places greater emphasis on chip design, research and development and talent development.<\/p>\n\n\n\n

Fabrication Subsidy Reduced<\/h2>\n\n\n\n

Under Semicon 2.0, silicon semiconductor fabrication plants will receive support equivalent to 40% of eligible capital expenditure. Compound-semiconductor fabs, display fabs and specialised semiconductor facilities will receive 35%.<\/p>\n\n\n\n

This is lower than the flat 50% capital subsidy offered under Semicon 1.0, the Rs 76,000-crore semiconductor programme notified in December 2021.<\/p>\n\n\n\n

The government has structured the new scheme around six areas: semiconductor design, equipment and materials, fabrication, assembly and testing, research, and talent development.<\/p>\n\n\n\n

Focus Shifts to the Wider Supply Chain<\/h2>\n\n\n\n

A major change under Semicon 2.0 is the inclusion of semiconductor equipment and materials manufacturing.<\/p>\n\n\n\n

India currently imports more than 90% of its semiconductor manufacturing equipment and around 85-90% of specialty chemicals used in the industry. The new equipment-and-materials pillar is intended to support domestic capacity in these areas.<\/p>\n\n\n\n

Eligible companies can receive financial support covering 30% of capital expenditure for equipment and materials manufacturing and research and development. The scheme also provides a production-linked incentive of up to 10% of the value of domestically sourced bill of materials from FY2028-29.<\/p>\n\n\n\n

For the semiconductor industry, building these supporting industries is important because chip manufacturing depends on a large network of specialised equipment, chemicals, gases and raw materials.<\/p>\n\n\n\n

Strategic Chip Designs to Remain in India<\/h2>\n\n\n\n

The scheme also introduces specific conditions for strategically important semiconductor designs.<\/p>\n\n\n\n

Under the strategic category, intellectual property developed through the programme will be co-owned by the applicant and the Centre for Development of Advanced Computing (C-DAC). Design and development files will also have to remain within India.<\/p>\n\n\n\n

Only companies incorporated, headquartered, owned and controlled by Indian citizens can apply under this category. Overseas Citizens of India can participate on the commercial side.<\/p>\n\n\n\n

Startups will be eligible for seed funding of up to Rs 15 crore or half of the project cost, whichever is lower.<\/p>\n\n\n\n

An expert panel will determine which semiconductor designs qualify as strategic. The categories include compute, memory, radio frequency, power, networking and sensors.<\/p>\n\n\n\n

Progress Under Semicon 1.0<\/h2>\n\n\n\n

The new scheme builds on projects approved under the first phase.<\/p>\n\n\n\n

Semicon 1.0 approved 12 projects across six states, with investment commitments exceeding Rs 1.64 lakh crore. Three backend semiconductor facilities have started commercial production this year, including Micron\u2019s assembly-and-test plant, Kaynes Semicon and CG Semi\u2019s OSAT facility in Sanand, Gujarat.<\/p>\n\n\n\n

India\u2019s first semiconductor fabrication plant, Tata Electronics\u2019 Rs 91,000-crore facility at Dholera, Gujarat, being developed with Taiwan\u2019s Powerchip Semiconductor Manufacturing Corporation, is expected to be commissioned in 2028.<\/p>\n\n\n\n

More Focus on Semiconductor Talent<\/h2>\n\n\n\n

Semicon 2.0 also raises the government\u2019s target for developing skilled chip-design professionals.<\/p>\n\n\n\n

The programme aims to train one lakh design engineers over five years, compared with the earlier target of 85,000 under Semicon 1.0.<\/p>\n\n\n\n

According to the government, the earlier target was achieved within four years, while chip-design facilities are now operating at 355 universities.<\/p>\n\n\n\n

What Semicon 2.0 Means for India<\/h2>\n\n\n\n

The expanded scheme seeks to build a semiconductor ecosystem rather than focus only on chip fabrication.<\/p>\n\n\n\n

For India, this could mean greater domestic participation across different stages of the semiconductor value chain, including design, manufacturing equipment, materials, packaging, research and development.<\/p>\n\n\n\n

The government has also sought to maintain a long-term policy framework for an industry where investments typically require significant capital and have long gestation periods.<\/p>\n\n\n\n

The India Semiconductor Mission will remain the nodal agency for the programme. Applications will remain open for three years, while projects involving more than Rs 500 crore will require Cabinet approval. A mid-term review is scheduled after three years of implementation.<\/p>\n\n\n\n

The effectiveness of Semicon 2.0 will ultimately depend on how successfully the financial support translates into domestic manufacturing capacity, private investment, technology development and a broader semiconductor supply chain in India.<\/p>\n\n\n\n

Source: The Print<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

The new scheme lowers fabrication subsidies but expands support to semiconductor equipment, materials, research, design and talent development. The government has notified the Rs 1,27,500-crore Semicon 2.0 scheme, expanding its focus beyond semiconductor fabrication to the wider chip manufacturing and supply chain ecosystem. The new programme reduces the capital subsidy available to semiconductor fabrication plants […]<\/p>\n","protected":false},"author":6,"featured_media":456,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[46,42,43,44,45],"class_list":["post-455","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-ashwini-vaishnaw","tag-semicon","tag-semicon-2-0","tag-semiconductors","tag-tata-electronics"],"_links":{"self":[{"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/posts\/455","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/comments?post=455"}],"version-history":[{"count":1,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/posts\/455\/revisions"}],"predecessor-version":[{"id":457,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/posts\/455\/revisions\/457"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/media\/456"}],"wp:attachment":[{"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/media?parent=455"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/categories?post=455"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thesimplehaishow.com\/thesimplehaishow\/wp-json\/wp\/v2\/tags?post=455"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}