Government notifies Rs 1.27 lakh crore Semicon 2.0 scheme to boost chip ecosystem

The Indian government has announced the Semicon 2.0 scheme, allocating ₹1.27 lakh crore for bolstering the country's semiconductor design and manufacturing ecosystem. The comprehensive program is divided into six key areas spanning the entire semiconductor value chain, including chip design, capital equipment manufacturing, fabrication units, and assembly, packaging, and testing.

This initiative aims to provide long-term policy and financial backing to the sector, strengthening capabilities throughout the semiconductor ecosystem.

A primary objective of Semicon 2.0 is to foster domestic semiconductor intellectual property (IP) cores, chips, system-on-chips (SoCs), and modules integral to electronic products. The government will prioritize the development of essential technologies based on national importance and strategic priorities, extending support across various applications and segments.

In addition to enhancing domestic capabilities, Semicon 2.0 will concentrate on building the foundational technology components required to create a more robust semiconductor industry. This includes standardized IPs covering computing, memory, radiofrequency (RF), power, networking, and sensors. By bolstering these core capabilities alongside fabrication, packaging, and testing infrastructure, the government intends to establish a more interconnected semiconductor value chain within India.

The announcement comes amid India's efforts to minimize reliance on foreign semiconductor supply chains and position itself as a competitive hub for chip manufacturing and technology development. The government's focus on domestic IP and strategic semiconductor technologies underscores its commitment to strengthening critical electronic systems and reinforcing technological capabilities that are vital for national security and infrastructure.