Cabinet Approves Semicon 2.0 Scheme Worth Rs 1.27 Lakh Crore

The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the ‘Semicon 2.0’ scheme with a total outlay of Rs 1,27,500 crore to accelerate the development of a domestic semiconductor design and manufacturing ecosystem.

The approval follows the progress made under the earlier Semicon 1.0 initiative.

So far, 12 manufacturing units have been cleared with a cumulative investment exceeding Rs 1.64 lakh crore. These include one silicon fab, one silicon carbide fab, an integrated gallium nitride micro LED display fab and nine packaging units.

The facilities are expected to serve sectors such as consumer appliances, industrial electronics, automobiles, power electronics, telecommunications and aerospace.

Of the 12 approved proposals, Micron, Kaynes and CG Semi have already started commercial production, while one more unit is expected to begin operations in 2026.

The government has also approved 24 semiconductor design projects from startups and MSMEs for financial support.

In addition, 105 startups and MSMEs have been granted access to industry-standard Electronic Design Automation (EDA) tools.

According to the Cabinet communique, Semicon 2.0 seeks to build on the momentum generated under Semicon 1.0 and strengthen India’s position in the global semiconductor landscape.

The scheme is structured around six pillars:

1. Deepening chip design capabilities,
2. Incentivising machines and materials manufacturing,
3. Attracting more semiconductor fabs,
4. Encouraging advanced ATMP/OSAT units,
5. Expanding research and development, and
6. Strengthening talent development

The first fab approved under the programme is scheduled to be commissioned in 2028.

The government said efforts will continue to attract additional manufacturers and advanced semiconductor technologies to India.

India has already trained around 68,000 students in complex chip design across 315 universities using the latest EDA tools. The training ecosystem will be further expanded under Semicon 2.0.

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