India's Cabinet approves ₹1.27 lakh crore for Semicon Mission 2.0

The Union Cabinet, chaired by Prime Minister Narendra Modi, cleared Semicon 2.0 on July 15, 2026, in New Delhi, sanctioning a total outlay of Rs 1,27,500 crore to deepen India's semiconductor design and manufacturing base. The scheme builds on the momentum of Semicon 1.0, aiming to extend long-term policy support to the sector under the Ministry of Electronics & IT.

What is the Semicon 2.0 mission?

Semicon 2.0 is designed to develop a holistic domestic semiconductor ecosystem, moving beyond one-off incentives toward sustained support across design, manufacturing, R&D, and talent creation to place India on the global semiconductor map.

Six Pillars of Semicon 2.0 Mission

Semicon 2.0 aims to holistically build the semiconductor ecosystem on the following six pillars:

1. First Pillar: Chip Design

India already has 105 startups building chips. Semicon 2.0 will help them go further — creating original chip designs and technology (IP) so India becomes known globally as a chip-design hub, not just a manufacturing base.

2. Second Pillar: Machines and Materials

 Making chips needs special machines, chemicals, and gases. The scheme will support companies that make these tools in India, which also helps grow India's broader precision manufacturing industry.

3. Third Pillar: More Chip Factories (Fabs)

 India's first chip factory is set to open in 2028. Semicon 2.0 will work to bring in more factories — for silicon chips, display chips, and other types — so India can make a wider range of chips at home.

4. Fourth Pillar: Boosting Packaging and Testing Units (ATMP/OSAT)

 After a chip is made, it needs to be packaged and tested. India has already found success here, and the scheme will now try to bring in more advanced global technology for this stage.

5. Fifth Pillar: Research & Development

 India currently makes chips using older, larger technology (28nm-110nm). The focus now shifts to developing smaller, more advanced chip technology by working with top research institutions in India and abroad.

6. Sixth Pillar: Building Skilled Talent

 About 68,000 students across 315 universities have already been trained in chip design. This pillar will deepen that training and also build hands-on skills needed for running clean rooms and factories.

Overall, Semicon 2.0 isn't just about chips — it's meant to boost the wider economy, make India less dependent on other countries for critical technology, and help India lead in advanced tech sectors globally.

Progress Made Under Semicon 1.0

Twelve manufacturing units have been approved so far, drawing a cumulative investment of over Rs 1.64 lakh crore, including a silicon fab, a silicon carbide fab, and a gallium nitride micro-LED display fab. Three companies, Micron, Kaynes, and CG Semi, have already begun commercial production. On the design side, 24 projects from startups and MSMEs have received financial backing, while 105 firms now have access to industry-standard EDA tools for applications spanning satellites, drones, IoT devices, and AI systems.