Cabinet approves Rs 1.27 lakh crore ISM 2.0 to boost India's semiconductor industry

The Union Cabinet has approved the India Semiconductor Mission (ISM) 2.0, allocating ₹1.27 lakh crore to strengthen the country's semiconductor and electronics manufacturing ecosystem. The ambitious programme is expected to attract around ₹4 lakh crore in private investments, significantly expanding India's chip manufacturing capabilities and reducing dependence on imports.

Building on the progress of the first phase of the mission, ISM 2.0 introduces a six-pillar strategy focused on semiconductor fabrication, chip packaging and testing, design innovation, research and development, skill development, and creating a resilient supply chain.

The initiative aims to position India as a global hub for semiconductor manufacturing while supporting industries such as artificial intelligence, electric vehicles, telecommunications, consumer electronics, and defence.

The government expects the programme to generate large-scale employment, encourage technology transfer, and attract leading global semiconductor companies to invest in India.

Officials believe the initiative will accelerate domestic production, enhance technological self-reliance, and strengthen India's role in the global semiconductor value chain. The approval marks one of the country's biggest policy pushes to build a world-class electronics manufacturing ecosystem and drive long-term economic growth.