Cabinet Approves ₹1.89 Lakh Crore for Semiconductors and Mobiles

The Union Cabinet has cleared two major manufacturing schemes with a total outlay of ₹1.89 lakh crore to bolster India’s electronics and chip production capabilities. The Semiconductor Mission 2.0 has been allocated ₹1.27 lakh crore, aimed at strengthening the entire chip supply chain, including subsidies for chemical and gas producers, as well as research and development. Additionally, a new mobile manufacturing scheme has been approved with a ₹62,500 crore budget to incentivize domestic brand growth and expand export potential.

This policy move builds upon the foundation established by the first Semiconductor Mission (ISM 1.0) launched in 2021. While ISM 1.0 focused on initial plant approvals—such as those by Micron Technology, Tata Electronics, and Kaynes Semicon—ISM 2.0 shifts the strategy toward deep-layer value addition. By 2029, the government aims to design and manufacture chips for 75% of domestic applications, effectively positioning India to play a central role in the global semiconductor ecosystem.

The approval also includes significant regional projects, such as elevated corridors in Varanasi and rail network upgrades, reflecting a broader strategy to support domestic manufacturing hubs. With 12 chip facilities already in the works across states like Gujarat, Assam, and Uttar Pradesh, these new funds are expected to accelerate local production of critical components. The focus on ancillary industries and chip design is a strategic attempt by New Delhi to mitigate supply chain risks and foster high-tech job creation across the country.