Cabinet approves Semicon 2.0 with budget outlay of ₹1.27 lakh crore
The government said Semicon 2.0 would support economic growth across sectors, strengthen national security through resilient supply chains and help establish technological leadership in critical industries.
- Jul 15, 2026,
- Updated Jul 15, 2026 4:17 PM IST
The Union Cabinet has approved Semicon 2.0, a new phase of India's semiconductor programme with a budget outlay of ₹1,27,500 crore, aimed at strengthening the country's semiconductor ecosystem.
The government said Semicon 2.0 would support economic growth across sectors, strengthen national security through resilient supply chains and help establish technological leadership in critical industries.
MUST READ | PM Modi reveals he had a semiconductor plan 20 years ago. Why it never took off
According to the government, Semicon 2.0 will focus on six key pillars covering the entire semiconductor value chain.
The first pillar aims to strengthen semiconductor design. With 105 startups already developing chips, the government plans to deepen the design ecosystem by supporting the development of intellectual property, chip designs and semiconductor systems for both strategic and commercial applications.
The second pillar focuses on incentivising companies engaged in manufacturing and research and development of semiconductor equipment, as well as materials, chemicals and gases required for chip production.
The third pillar seeks to attract additional semiconductor fabrication units. With the country's first semiconductor fab scheduled to be commissioned in 2028, the government plans to encourage investments in silicon fabs, compound semiconductor fabs, discrete component fabs and display fabs.
The fourth pillar will further strengthen India's Assembly, Testing, Marking and Packaging (ATMP) and Outsourced Semiconductor Assembly and Test (OSAT) industry. The government said growing global interest in India as an alternative manufacturing destination presents an opportunity to attract advanced ATMP technologies.
Research and development forms the fifth pillar of the programme. While India's semiconductor journey has begun with 28nm to 110nm process nodes, Semicon 2.0 aims to develop more advanced nodes and emerging technologies through collaboration with leading research centres in India and abroad.
The sixth pillar focuses on talent development. At present, 315 universities are training students in advanced chip design using industry-standard Electronic Design Automation (EDA) tools, with around 68,000 students already trained.
Under Semicon 1.0, the government approved 12 manufacturing units involving cumulative investments of more than ₹1.64 lakh crore. These include one silicon fab, one silicon carbide fab, one integrated gallium nitride Micro LED display fab and nine packaging units catering to sectors such as consumer electronics, automobiles, telecommunications, aerospace and power electronics. Of the approved projects, Micron, Kaynes and CG Semi have already commenced commercial production, while another unit is expected to begin operations in 2026.
The Union Cabinet has approved Semicon 2.0, a new phase of India's semiconductor programme with a budget outlay of ₹1,27,500 crore, aimed at strengthening the country's semiconductor ecosystem.
The government said Semicon 2.0 would support economic growth across sectors, strengthen national security through resilient supply chains and help establish technological leadership in critical industries.
MUST READ | PM Modi reveals he had a semiconductor plan 20 years ago. Why it never took off
According to the government, Semicon 2.0 will focus on six key pillars covering the entire semiconductor value chain.
The first pillar aims to strengthen semiconductor design. With 105 startups already developing chips, the government plans to deepen the design ecosystem by supporting the development of intellectual property, chip designs and semiconductor systems for both strategic and commercial applications.
The second pillar focuses on incentivising companies engaged in manufacturing and research and development of semiconductor equipment, as well as materials, chemicals and gases required for chip production.
The third pillar seeks to attract additional semiconductor fabrication units. With the country's first semiconductor fab scheduled to be commissioned in 2028, the government plans to encourage investments in silicon fabs, compound semiconductor fabs, discrete component fabs and display fabs.
The fourth pillar will further strengthen India's Assembly, Testing, Marking and Packaging (ATMP) and Outsourced Semiconductor Assembly and Test (OSAT) industry. The government said growing global interest in India as an alternative manufacturing destination presents an opportunity to attract advanced ATMP technologies.
Research and development forms the fifth pillar of the programme. While India's semiconductor journey has begun with 28nm to 110nm process nodes, Semicon 2.0 aims to develop more advanced nodes and emerging technologies through collaboration with leading research centres in India and abroad.
The sixth pillar focuses on talent development. At present, 315 universities are training students in advanced chip design using industry-standard Electronic Design Automation (EDA) tools, with around 68,000 students already trained.
Under Semicon 1.0, the government approved 12 manufacturing units involving cumulative investments of more than ₹1.64 lakh crore. These include one silicon fab, one silicon carbide fab, one integrated gallium nitride Micro LED display fab and nine packaging units catering to sectors such as consumer electronics, automobiles, telecommunications, aerospace and power electronics. Of the approved projects, Micron, Kaynes and CG Semi have already commenced commercial production, while another unit is expected to begin operations in 2026.