New Delhi, 12 September, 2024— As part of the growing program to benefit the semiconductor industry, the Government of India is building upon the India Semiconductor Mission (ISM) with the impending launch of its second phase—Semicon 2.0. “In the next three to four months, tomorrow we are going to announce a very aggressive scheme that is going to be many, many times bigger than what we have done in the first round,” Union Minister Ashwini Vaishnaw said at the Semicon India 2024 conference.
Fab Focus and Ecosystem Integration
Initiated in December 2021 with an investment of Rs. 76,000 crore, the first phase mainly focused on encouraging chip fabrication and packaging facilities. Several projects include:
- Tata Electronics- Powerchip fab in Dholera, Gujarat.
- Tata-led assembly and test (ATMP) unit in Assam.
- Four packaging and testing sites- three in Sanand, Gujarat, and one in Morigaon, Assam
- The further coming HCL-Foxconn joint OSAT plant near Jewar, Uttar Pradesh
Altogether, these initiatives are worth more than Rs. 1.5 lakh crore of investment and tens of thousands of jobs.
Going beyond fab and packaging, Semicon2.0 moves the mission goalposts: It hopes to attract component vendors, specialty gas and chemical suppliers, equipment vendors, and design houses. Put another way, it intends to bring together the entire semiconductor value chain— from ingots and wafers to test labs and chip designers.
Future Development Focus
IT Secretary S. Krishnan said the blueprint for Semicon 2.0 is ready and the government is engaged in a detailed interdepartmental consultation process.
Design-incentive expansion: Further aid start-ups and companies looking to develop innovative chip and package design.
Ecosystem Inputs Grants: Providing financial support to import or produce in-country critical gases, chemicals, and specialty materials (approximately 250) that are required for semiconductor fabrication.
Manufacturing of Semiconductor Equipment: Strategic incentives to encourage leading global suppliers of semiconductor equipment to set up domestic manufacturing operations to increase self-reliance and minimize costs.
Other states also plan to participate: Uttar Pradesh has reserved 1,000 acres near the Yamuna and has announced land and capital subsidies covering about 25 percent of expenses.
Development in Progress
As Semicon 2.0 takes shape, numerous projects are in progress or have been granted approval:
The HCL-Foxconn joint venture indicates the establishment of its sixth plant under ISM, and especially, it is the first in Uttar Pradesh, located near Jewar with an investment of Rs. 3,700 crore ($435 million).
Micron has announced plans for a Rs. 13,000 crore semiconductor SEZ in Gujarat, strengthening its current packaging unit.
CEO Rajnath Singh recently pointed out the establishment of a Rs. 2,500 crore chip facility in Lucknow, anticipating easier approvals under Semicon 2.0.
L&T Semiconductor Technologies (LTSCT) has revealed plans to establish a $10 billion fabrication plant by 2027, dependent on achieving design revenues of $1 billion by FY26–27. The government could potentially cover as much as 90 percent of capital expenditures through various incentives.
India’s aspiration arises in the context of increasing global competition for supremacy in the semiconductor sector. The U.S.– India Critical Emerging Technology (iCET) has revitalized dual efforts regarding chip policy and research and development. As global chip demand skyrockets– driven by AI, IoT, telecom, and automotive industries- India’s initiative to develop comprehensive capabilities establishes it as a significant emerging competitor.
Future Development Strategies
The launch window for Semicon 2.0 is anticipated to take place in late Q3 or early Q4 of 2025, depending on Cabinet and state approvals.
Offer for new proposals: New applications will be requested for design houses, ecosystem suppliers, equipment manufacturers, and component fabrication facilities.
Budget expansion: A significant increase—potentially Rs. 1–1.5 lakh crore is expected, surpassing the original Rs. 76,000 crore PLI pool.
Deployment timeline: Initial disbursements might start by early 2026, supporting design-linked projects and specialized material producers.
Conclusion
Semicon 2.0 represents a strategic transformation – shifting from only the assembly of units to the establishment of a comprehensive semiconductor nation-building ecosystem. If the government effectively enhances incentives, infrastructure, and approvals, India could promote ongoing semiconductor development, reduce import dependency, and promote domestic design innovation.
Source By:- https://www.newindianexpress.com/
