New Delhi — India’s Semicon 2.0 program marks a shift from primarily expanding semiconductor manufacturing capacity toward building deeper capabilities in chip design, research and development, talent and supply chains, industry experts said Monday.
The program, with an outlay of Rs 1.27 lakh crore, is designed to attract about Rs 4 lakh crore in investment and support roughly Rs 2 lakh crore in semiconductor production over the scheme period.
The India Cellular and Electronics Association said companies, investors and state governments should move quickly to turn the new framework into projects and develop more Indian-owned intellectual property.
The program includes fiscal incentives such as 40% capital expenditure support for silicon fabrication plants on a pari-passu basis, along with combined central and state support of up to 75% for certain R&D and talent initiatives.
Semicon 2.0 is built around six areas: chip design, semiconductor equipment and materials, additional fabrication plants, strengthening the ATMP and OSAT industries, research and development, and talent development.
The talent component aims to train 100,000 chip design engineers over five years while also expanding skills in fabrication, packaging, equipment and materials.
Pankaj Mohindroo, Chairman of ICEA, said developing Indian-owned chip design capabilities, including technology for artificial intelligence computing, could help domestic companies move higher up the semiconductor value chain.
“Building Indian-owned chip-design capability, including for AI compute, will allow companies to move higher up the value chain, retain a larger share of global electronics and generate growth that is recurring and durable not dependent on a single manufacturing cycle,” Mohindroo said.
“Government’s focus on developing domestic design and R&D will pave the way for long-term and sustained growth of the industry. Design is where value, intellectual property and strategic control reside,” he added.
ICEA said manufacturing expansion should be accompanied by progress in chip design, AI computing, domestic intellectual property and the wider semiconductor supply chain.
The group also said states that move quickly could gain an advantage by attracting entire semiconductor ecosystems rather than individual plants, including fabs, packaging operations, suppliers, design companies and skilled workers.
Aisha Ali Hussaini, Partner and Semiconductor Tax Leader at EY India, said the initiative supports India’s ambition of capturing 10% of the projected $1.8 trillion to $2 trillion global semiconductor market by 2035.
“The programme provides a robust foundation for long-term economic growth by strengthening the domestic semiconductor value chain,” Hussaini said.
Paritosh Prajapati, CEO of GX Group, said the program’s emphasis on advanced packaging, chip design, displays and other critical semiconductor technologies could further strengthen India’s domestic capabilities across the industry. (Source: IANS)
