New Delhi, August 31: The Indian government has taken a significant step towards establishing the country as a global hub for semiconductor manufacturing and design. On Monday, it announced the Semicon 2.0 initiative, backed by an investment of ₹1.27 lakh crore. This ambitious plan aims to develop domestic capabilities across the entire semiconductor value chain, making India self-reliant in chip manufacturing, design, and advanced electronics production.
According to the government notification, the Semicon 2.0 initiative is divided into six key components. These include chip design by Indian companies, manufacturing of essential capital equipment for chip production, semiconductor fabrication units, chip assembly, packaging, testing, and related industrial activities. The initiative will provide financial assistance to various sectors within the industry.
The government emphasizes that this plan is not limited to enhancing manufacturing capacity. Its goal is to create a comprehensive and self-sufficient semiconductor ecosystem, supporting critical areas such as research, design, manufacturing, testing, packaging, and the production of specialized equipment.
Union Electronics and Information Technology Minister Ashwini Vaishnaw announced that a high-level expert committee will be formed to identify strategic semiconductor products eligible for incentives under this initiative. The committee will be co-chaired by the Principal Scientific Advisor (PSA) and the National Security Advisor (NSA).
In a media interaction, Vaishnaw stated that this committee will identify chips and semiconductor products deserving of special incentives based on national importance, strategic needs, and long-term industrial priorities. The aim is to ensure that government investments focus on areas where the country’s technological and strategic requirements are most pressing.
He further noted that the priority of the Semicon 2.0 initiative is not just to establish factories but to develop domestic capabilities throughout the value chain. This will provide Indian companies with greater opportunities in chip design and increase investments in fabrication, packaging, testing, and specialized machinery manufacturing.
Vaishnaw also highlighted that this initiative will help reduce India’s dependence on foreign suppliers. He specifically mentioned products like sensors, stating that in the future, India could potentially meet nearly 100% of its domestic needs through local production.
It is noteworthy that semiconductors have become a fundamental requirement across nearly every modern sector, including electronics, automobiles, telecommunications, defense, artificial intelligence (AI), industrial automation, and consumer devices. Following disruptions in the global supply chain, India has identified this sector as a strategic priority.
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