India Semiconductor Mission 2.0 might get Cabinet approval by March
What's the story
The Indian government's fiscal support program for chip development and manufacturing, the India Semiconductor Mission (ISM), is all set for Cabinet approval. Officials from the Ministry of Electronics and IT have confirmed that they are targeting a nod by the end of March 2026. The ISM 2.0 is being seen as an extension of this incentive program to promote chip design and fabrication in India.
Project expansion
ISM 2.0: A continuation of Phase 1's success
Phase 1 of the ISM was approved in 2021 with an allocation of ₹76,000 crore. It has so far approved a total of 10 semiconductor projects, including fabs, display fabs, compound semiconductors, and Assembly Testing Marking and Packaging (ATMP) facilities. The cumulative investment across these projects is estimated at ₹1.6 lakh crore across six states.
Increased allocation
ISM 2.0's budget likely to exceed Phase 1
The budget for ISM 2.0 is expected to be larger than the ₹76,000 crore allocated for Phase 1. The scheme structure has already been finalized within the Ministry of Electronics and IT (MeitY). After MeitY's approval, ISM 2.0 will need clearance from the Finance Ministry for proposed expenditures and funding arrangements.
Approval process
Inter-ministry consultations to begin soon
MeitY is likely to start inter-ministry consultations soon to get the required approvals for ISM 2.0. Once these consultations are done, the government will probably submit a Cabinet note seeking final approval for this ambitious chip development and manufacturing initiative. The move is part of India's broader strategy to bolster its semiconductor industry and reduce reliance on imports.