India Gets ₹1 Lakh Cr Investment Commitments Under Semicon 2.0: Vaishnaw

Under the recently approved Semicon 2.0 mission, the Central government is seeing investment commitments worth approximately ₹1 Lakh Cr ($11-12 Bn), union minister Ashwini Vaishnaw said during his address at Semicon India 2026. 

Global players across capital equipment, materials, specialty gases, and advanced packaging have pledged to deploy this capital over the next 2-3 years as India scales up its domestic electronics value chain, the minister said. 

The estimates are based on the minister’s discussions with the companies, some of whom are yet to make their investment plans public. Notably, US-based semiconductor company Applied Materials announced a $5 Bn (about ₹48,000 Cr) investment commitment earlier today.

Vaishnaw also highlighted that the government would be targeting at least 200 startups and companies operating under the Semicon 2.0. Under the initial phase of the mission, Vaishnaw said that more than 105 startups attempted chip design, of which about 20 secured venture capital funding worth around ₹800 Cr.

“Semicon 1.0 was all about setting the foundation and making sure that we learned to walk. Semiconductor 2.0 is more about getting the ecosystem in place,” said Vaishnaw. 

The first phase of the India Semiconductor Mission (Semicon 1.0) was approved with an outlay of ₹76,000 Cr in December 2021. Under the mission, 12 semiconductor manufacturing units were approved, carrying a cumulative investment of over ₹1.64 Lakh Cr.

In July 2026, India approved Semicon 2.0 with a total outlay of ₹1.28 Lakh Cr.

With the Semicon 2.0, eligible semiconductor startups and MSMEs can get up to ₹15 Cr in seed funding, along with equity co-investment support for companies backed by VC or PE investors. Deployment-linked incentives will also be available for semiconductor IPs, chips and SoCs launched after the scheme’s announcement.

The scheme will provide fiscal support for semiconductor fabs and advanced packaging facilities. Silicon wafer fabs with at least ₹20,000 Cr investment will qualify for support of up to 40% of eligible capex, while compound semiconductor, photonics, sensor and discrete fabs will also be eligible.

Advanced packaging projects, including 2.5D/3D packaging, wafer-level chip-scale packaging and heterogeneous integration, will also receive support, alongside R&D facilities for semiconductor equipment, raw materials and testing infrastructure.

The Semicon 2.0 Roadmap

The Semicon 2.0’s roadmap rests on six core pillars: developing the chip design ecosystem, equipment and raw materials, adding new semiconductor fabs, advanced packaging, applied R&D, and large-scale talent creation. 

As part of the sixth pillar, the government plans to expand the current chip design courses that are being taught at 400 universities as part of Semicon 1.0 in order to train at least 20% of chip design students in complex systems design. 

However, the government will not adopt a revenue-sharing model like the US CHIPS Act, as India’s semiconductor industry is far more nascent and the policy framework is tailored to the domestic conditions, noted Vaishnaw. 

He also took Japan as an example for India to look towards, noting, “Japan was the leader in semiconductor manufacturing for many decades. Then leadership was taken by other countries. But a few years ago, when Japan decided to renew its capabilities and bring high-end chip manufacturing back to the country, it could do so because it had a very strong ecosystem.” 

“To have a long journey, a long growth path, and a journey where we keep growing over the next twenty or thirty years, we must have the ecosystem in place. That is how we have designed the entire Semiconductor 2.0 programme,” he added. 

India’s semiconductor demand is expected to reach $110 Bn by FY30 and exceed $200 Bn by FY35. Yet domestic manufacturing remains at an early stage. India imported nearly $150 Bn worth of semiconductor products between FY17 and FY25, with imports growing at a 23% CAGR. If the trend continues, annual imports could reach $240 Bn by 2035.

Against this backdrop, the government is seeking to build a comprehensive semiconductor ecosystem spanning manufacturing, design, packaging, equipment, materials and R&D, with a focus on self-reliance, supply-chain resilience and technological competitiveness.

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