India's Semicon 2.0: Government expands incentives for semiconductor ecosystem beyond fabrication

India is in the final stages of rolling out Semicon 2.0, the next phase of its semiconductor mission, with the government set to expand incentives beyond chip fabrication to support the broader semiconductor ecosystem.

Speaking during an online session hosted by the India Semiconductor Mission (ISM) on Monday, ISM CEO Amitesh Kumar Sinha said the policy is being finalised and will be announced soon. The revised programme will broaden eligibility and strengthen incentives for semiconductor design startups, he said.

Unlike the first phase, which focused mainly on attracting investments in chip fabrication and packaging, Semicon 2.0 will extend support across the semiconductor value chain. The policy will cover chip design startups, suppliers of semiconductor-grade chemicals, gases, materials and manufacturing equipment, as well as talent development and indigenous research in critical semiconductor technologies.


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Sinha said building a domestic supply chain is central to India's semiconductor strategy. A modern semiconductor fabrication plant requires between 200 and 250 specialised chemicals, gases and materials, most of which are currently imported.

"We want the ecosystem to come to India, not just the fabs," he said, adding that developing domestic suppliers would strengthen supply chain resilience and reduce import dependence.

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Under the first phase of the India Semiconductor Mission, the government has approved 12 projects covering chip design, fabrication and packaging. Three facilities: Micron's assembly and test plant, the CG Power-Renesas OSAT facility, and Kaynes Semicon's packaging unit have already commenced production.