India Approves Semicon 2.0 with US$13.23 Billion Outlay to Boost Domestic Semiconductor Ecosystem

India's ambition to become a global player in the semiconductor industry has received a major boost with the Union Cabinet's approval of the Semicon 2.0 scheme. Announced on July 15, 2026, this second phase of the India Semiconductor Mission (ISM) comes with a substantial budgetary outlay of ₹1,27,500 crore, equivalent to approximately US$13.23 billion. This strategic initiative moves beyond the initial focus on just establishing fabrication plants to fostering a holistic and integrated semiconductor ecosystem within the country. Semicon 2.0 is designed to strengthen various critical aspects of the semiconductor value chain. It encompasses supporting chip design, the manufacturing of semiconductor equipment and specialty materials, setting up new fabrication facilities, and advancing assembly, testing, marking, and packaging (ATMP) units. Furthermore, the scheme emphasizes research and development (R&D) and talent development to create a skilled workforce crucial for the sector's growth. The government's move reflects a long-term commitment to enhancing national security through resilient semiconductor supply chains and establishing India's technological leadership. Already, under the previous phase, 24 semiconductor design projects from startups and MSMEs have received financial support, and 105 entities have gained access to industry-standard Electronic Design Automation (EDA) tools. These efforts are contributing to the design of chips for diverse strategic and commercial applications, including AI systems, satellite communications, drones, and IoT devices. The scheme aims to deepen domestic value addition, create high-quality employment opportunities, and reduce India's reliance on global semiconductor supply chains, ultimately positioning the nation as a trusted hub for semiconductor manufacturing.