Cabinet Approves Semicon 2.0: ₹1.27 Lakh Crore Initiative to Build India’s Semiconductor Ecosystem

The Union Cabinet under the leadership of Honorable Prime Minister Narendra Modi given its approval to the Semicon 2.0, a policy to enhance the India’s semiconductor design and making ecosystem. Semicon 2.0 has been approved in a meeting presided by Prime Minister Narendra Modi, and a budget of ₹1,27,500 crore has been allotted for the project. The primary objective of the project is to improve chip designing functions and capabilities, lure advanced semiconductors manufacturing companies, focus on the research and innovation efforts, support development of skilled workforce, and contribute to building a reliable semiconductor supply chain making India technologically and economically self-reliant.

What is Semicon 2.0?

Semicon 2.o is a new semiconductor development program introduced by the Indian government to provide continuous policy support to the semiconductor industry in India.

The program is based on the earliest version Semicon 1.0 and aims to create a full semiconductor ecosystem which covers all stages from design and manufacturing of the chip, to its packaging, development of materials, research, and workforce.

India is recognized as a strategically important sector by the government, and efforts have been taken to make it a trusted global hub for the manufacturing and innovation in semiconductors.

The Purpose Behind the Launch of Semicon 2.0

Semiconductors are crucial for the nearly all advanced devices, such as mobile phones, electric vehicles, artificial intelligence, telecommunications, medical apparatus, defense apparatus, and automated processes.

India has made the significant advances in the field of semiconductor design and packaging, and it now aims to build a more robust domestic semiconductor industry by improving the local production capabilities and lessening dependence on foreign smelters.

The objectives of the Semicon 2.0 program include,

• Upbuilding the entire ecosystem of the semiconductors,
• Improving the design skills of Indian companies,
• Promoting semiconductor manufacturing,
• Working towards the local production of the semiconductors,
• Ensuring better resilience of the supply chain,
• Working towards technological independence,
• Positioning the country as a semiconductor superpower.

Reflecting on the accomplishments made in establishing the chip design industry in India, Semicon 2.0 intends to build up on the existing capabilities of local talents in design of chips.

The Six Strategic Pillars of Semicon 2.0

1. Strengthening Semiconductor Design
2. Developing Machines, Materials and Chemicals
3. Setting Up More Semiconductor Fabs
4. Strengthening the ATMP/OSAT Industry
5. Accelerating Research and Development
6. Talent Development

Key Benefits of Semicon 2.0

The government expects that the Semicon 2.0 to deliver multiple long-term benefits.

• Strengthening the India’s Semiconductor Ecosystem
• Boosting Economic Growth
• Enhancing National Security
• Promoting Technological Leadership

Progress Under Semicon 1.0

The foundation for the new initiative has been laid with the government’s first semiconductor venture.

Achievements in Manufacturing,

Under Semicon 1.0,

• 12 manufacturing initiatives have been sanctioned.
• The projected expenditures go up to ₹1.64 lakh crore.

Two prominent fabrication plants are anticipated for,

• A silicon wafer manufacturing unit.
• A silicon carbide wafer plant.
• With respect to the micro LED display, an advanced integrated facility is included.
• In addition, there are expected to be nine semiconductor assembly units too.

The semiconductor manufacturing processes supported by these set-ups will cover areas like auto-motive, consumer electronics, telecommunications, industrial electronics, aerospace, and power electronics.