What's Happening?
India has announced the India Semiconductor Mission 2.0 as part of its Union Budget 2026-27, marking a significant step towards enhancing its domestic semiconductor capabilities. This initiative aims to produce
semiconductor equipment and materials within India, design full-stack Indian semiconductor intellectual property, and strengthen both domestic and global supply chains. A budget of Rs. 1,000 crore has been allocated for the mission, focusing on industry-led research and training centers to foster technology development and create a skilled workforce. The mission builds on previous efforts under ISM 1.0, which expanded design capabilities and advanced fabrication infrastructure. The goal is to position India as a reliable participant in the global semiconductor network, with plans to achieve advanced manufacturing capabilities by 2035.
Why It's Important?
The India Semiconductor Mission 2.0 is crucial for reducing India's dependency on external semiconductor suppliers and enhancing its technological sovereignty. Semiconductors are vital for modern electronics, impacting sectors like telecommunications, automobiles, and artificial intelligence. Global disruptions, such as the COVID-19 pandemic, have highlighted vulnerabilities in semiconductor supply chains, prompting countries to strengthen domestic production. By investing in semiconductor design and manufacturing, India aims to become a key player in the global market, contributing to more resilient supply chains. This initiative aligns with India's broader vision of 'Make in India' and 'Make for the World,' potentially boosting economic growth and employment.
What's Next?
India plans to focus on advanced manufacturing technologies, aiming to achieve 3-nanometre and 2-nanometre technology nodes by 2035. The mission will support semiconductor fabs, compound semiconductors, and chip design, with a financial outlay of Rs. 8,000 crore for 2026-27. The program is expected to accelerate capital investment, generate high-quality employment, and expand domestic capabilities. India aims to design and manufacture chips for 70-75% of domestic applications by 2029, positioning itself as a global hub for semiconductor innovation.
Beyond the Headlines
The India Semiconductor Mission 2.0 not only focuses on manufacturing but also emphasizes developing a robust semiconductor design ecosystem. The Design Linked Incentive Scheme supports domestic innovation and startups, bridging the gap between academic research and industry application. Indigenous microprocessors like DHRUV64 are being developed to reduce reliance on imported chips, supporting sectors like 5G infrastructure and IoT. These efforts are crucial for India's digital sovereignty and long-term ambitions in the global semiconductor value chain.
