Govt to Fast-Track Next Round of India Semiconductor Mission

India is fast-emerging as a strong player in the global electronics and semiconductor ecosystem.

Govt to Fast-Track Next Round of India Semiconductor

In 2025, the government has announced plans to fast-track the next round of the India Semiconductor Mission (ISM), a flagship initiative under the Ministry of Electronics and Information Technology (MeitY).

Govt technology

This move is seen as a decisive step to reduce dependency on imports, attract global chipmakers, and build a resilient ecosystem that empowers Atmanirbhar Bharat (self-reliant India).

Why the Semiconductor Mission Matters

Semiconductors are the backbone of nearly every modern industry—from smartphones, electric vehicles, and artificial intelligence systems, to defense electronics and high-performance computing. At a time when global supply chains are volatile, countries across the world are pushing for local semiconductor manufacturing.

For India, this mission is not just an industrial initiative—it is a strategic necessity. With the electronics market projected to be worth over $300 billion by 2026, building domestic capacity is crucial to ensuring technology sovereignty.

What the Next Round Involves

The government intends to accelerate approvals, financial incentives, and infrastructure support for companies under the next round of ISM. Some key focus areas include:

• Faster clearance of applications: Companies setting up fabs and semiconductor units will see reduced bureaucratic delays through a “single-window approval” system.

• Expanded incentive packages: Larger subsidies and capital support will be provided to attract global investments from chipmaking giants.

• Focus on specialized fabs: Efforts will be made to promote legacy node fabs for automotive and industrial chips that are in short supply.

• Design-linked initiatives: Startups and chip design companies will receive increased support through grants and partnerships.

• Collaborations with states: State governments are being encouraged to develop semiconductor clusters and provide local benefits such as tax rebates, water supply, and skilled workforce development.

India’s Semiconductor Push So Far

The India Semiconductor Mission was first launched in 2021 with a funding package of ₹76,000 crore (around $10 billion). Since then, multiple global and domestic companies have shown interest in setting up fabs and packaging plants in India.

• Micron Technology announced a major investment in Gujarat for a semiconductor packaging facility.

• Tata Group has been exploring end-to-end semiconductor manufacturing, from chip design to fabrication.

• Foxconn remains engaged in talks regarding potential semiconductor ventures.

The fresh acceleration of ISM in 2025 builds upon these early steps, signaling a stronger political and financial will to ensure success.

Global Context and Competition

India’s initiative comes at a time when the United States, China, Taiwan, South Korea, Japan, and the EU are heavily subsidizing chipmaking industries. The U.S.

passed the CHIPS and Science Act, while the EU has its own Chips Act, creating fierce competition for attracting semiconductor manufacturers.

India’s distinct advantage lies in its large domestic demand, skilled engineering talent pool, and competitive costs. With global players seeking to diversify away from overconcentration in East Asia, India could emerge as an attractive and stable destination.

Opportunities for India

1. Job Creation: Semiconductor fabs and ancillary industries can create thousands of direct and indirect jobs, from chip designers to cleanroom technicians.

2. Boost to Electronics Manufacturing: With local silicon production, sectors like smartphones, EVs, and defense will benefit from reduced import dependence.

3. Technology Transfer: Collaborations with global chipmakers can bring advanced know-how, enabling India to move faster on the learning curve.

4. Strengthening Supply Chains: Localized manufacturing will protect India from global crises like the 2020–21 semiconductor shortage.

Challenges Ahead

Despite optimism, several hurdles remain for India’s semiconductor dream:

• High capital requirement: Building fabs requires tens of billions of dollars in upfront investment.

• Stable supply of raw materials: Access to ultrapure water, rare gases, and reliable energy is critical.

• Skill gaps: While India has engineers, specialized skills in high-volume chip fabrication need to be cultivated.

• Global geopolitical competition: Every major economy is pouring billions into semiconductors, making the race highly competitive.

The fast-tracking of the next ISM round must address these challenges head-on to ensure its long-term viability.

Government’s Vision for 2030

The broader goal of the semiconductor mission is aligned with India’s aspiration to become a $5 trillion economy by 2030. By building a strong semiconductor base:

• India can turn into a global electronics hub.

• It can reduce its dependence on imports, which currently stand at 90-95% for semiconductors.

• Indigenous manufacturing will empower defense, 5G, IoT, AI, and renewable energy sectors.

This vision ties into the Digital India and Make in India movements, creating a long-term roadmap for inclusive growth.

Industry Expectations

Industry leaders have welcomed the government’s move to fast-track approvals.

Many believe that beyond large foreign direct investments, empowering local startups and strengthening R&D is vital to success. Initiatives like a semiconductor research university, tax incentives for local chip design, and government procurement preference for made-in-India chips are increasingly being recommended.

Conclusion

The fast-tracking of the next round of the India Semiconductor Mission in 2025 reflects the government’s determination to secure India’s place in the global technology race. With bold incentives, strong policy support, and a growing ecosystem, this could be the inflection point when India goes from being a semiconductor consumer to becoming a semiconductor producer.

Success in this mission will mark a historic milestone for India’s technological independence and economic future.