Our Bureau
New Delhi
The Union Cabinet has approved the ₹1.28 lakh crore India Semiconductor Mission (ISM) 2.0, marking one of the country’s largest investments in strengthening its semiconductor and electronics manufacturing ecosystem. The expanded programme aims to accelerate domestic chip production, enhance advanced packaging capabilities, support design innovation and reduce India’s dependence on imported semiconductors while positioning the country as global electronics manufacturing hub.
The new package builds on the existing semiconductor incentive scheme and introduces additional financial support for semiconductor fabrication units, display manufacturing, compound semiconductors, assembly, testing, marking and packaging (ATMP) facilities, as well as research and design. The Cabinet also approved an enhanced production-linked incentive (PLI) scheme for mobile phone manufacturing, with an outlay of ₹62,500 crore, to further strengthen the electronics value chain.
The government’s renewed push comes amid rising global demand for semiconductors driven by artificial intelligence, electric vehicles, consumer electronics and data centres. The initiative seeks to attract greater private investment, encourage global technology partnerships and develop a resilient domestic supply chain capable of serving both domestic and international markets.
Officials believe the programme will create thousands of high-skilled jobs across manufacturing, engineering and research while fostering innovation through stronger collaboration between industry, startups and academic institutions. It is also expected to improve India’s competitiveness in critical technologies and reduce vulnerabilities arising from global supply chain disruptions.
India has already attracted major semiconductor investments in recent years, including projects in fabrication, chip assembly and testing. With ISM 2.0, the government aims to build on this momentum by creating a comprehensive semiconductor ecosystem that spans design, manufacturing and advanced packaging.
