Synopsis

India is significantly boosting its semiconductor ambitions with a Rs 1.25 lakh crore allocation for India Semiconductor Mission 2.0, a substantial increase from its predecessor. This move signals a deep commitment to establishing India as a global chip-making hub, focusing on equipment, materials, indigenous designs, and resilient supply chains.

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New Delhi: The expenditure department under the Finance Ministry has cleared a Budget proposal entailing an allocation of Rs 1.25 lakh crore for India Semiconductor Mission 2.0, as the country looks to advance global chip-making ambitions and cement its position as a semiconductor destination for the world, according to sources.

The approval is significant as it is higher than the outlay of Rs 76,000 crore earmarked for ISM 1.0.

Sources said that the Expenditure Finance Committee has greenlit the Rs 1.25 lakh crore outlay for ISM 2.0, and that the same will be placed before the Cabinet.

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The Budget, in February, had sought to give a big boost to the country's manufacturing prowess announcing, among various measures, the second edition of India Semiconductor Mission with a broad objective to promote chip manufacturing ecosystem in the country covering equipment, materials, indigenous designs and other related components.

The government has maintained that India Semiconductor Mission 2.0 - announced in the Union Budget 2026-27 - signals India's deep commitment to chip manufacturing, with a focus on semiconductor equipment, materials, indigenous intellectual property and resilient supply chains.

Union Minister for Electronics and IT Ashwini Vaishnaw had earlier said that the India Semiconductor Mission 2.0 will prioritise indigenous chip design, productisation, attracting ecosystem partners and development of talent.

As many as 12 semiconductor manufacturing projects have been approved with an investment pipeline of about Rs 1.64 lakh crore under the India Semiconductor Mission, including one semiconductor fabrication unit, two compound semiconductor fabrication units and nine packaging units.

On the design side, 24 projects are being supported under the Design Linked Incentive Scheme, 105 companies have been assisted with advanced chip design tools and 23 design 'tapeouts' have been completed at various foundries, including at advanced nodes, reflecting India's growing depth in semiconductor design.

Terming the semiconductor advances as India's "long-time dream", a senior IT Ministry official said 12 semiconductor manufacturing projects have been approved, two of which have been inaugurated for commercial manufacture earlier this year. Another one - CG Semi - is likely to get inaugurated later this week.

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"CG Semi's inauguration is scheduled for July 4...and then probably one or two more (will happen) before the end of this calendar year, so our dream of having commercial semiconductor manufacturing in the country has finally been achieved," the IT Ministry official said, adding that more projects are likely to come up.

India has emerged as a key player in the technology landscape and "a voice to reckon with" on standards, the official added.