India has approved nearly US$20 billion in new incentives to expand domestic semiconductor and smartphone manufacturing, reinforcing Prime Minister Narendra Modi’s strategy to position the country as a global electronics production hub amid shifting supply chains.
The Union Cabinet approved Semicon 2.0, allocating ₹1.275 trillion (about US$13.3 billion) to accelerate semiconductor manufacturing, research and development, chip design, packaging and critical materials. The programme builds on the US$10 billion India Semiconductor Mission, launched in 2021, under which 12 manufacturing projects and 24 semiconductor design initiatives have already been approved.
Information and Electronics Minister Ashwini Vaishnaw said the new programme aims to deepen India’s semiconductor ecosystem and reduce reliance on imported chips through expanded domestic production and innovation.
The Cabinet also approved a ₹625 billion (about US$6.5 billion) Mobile Phone Manufacturing Scheme, which will provide sales-linked incentives for locally manufactured smartphones and components over the next five years. The initiative is designed to encourage greater domestic value addition, strengthen local supply chains and support continued growth in one of the world’s fastest-expanding smartphone manufacturing sectors.
The latest measures come as multinational technology companies diversify production beyond China and India seeks to attract higher-value electronics investment through a combination of financial incentives, infrastructure development and policy support. Officials say the twin programmes are intended to strengthen the country’s long-term competitiveness across the global semiconductor and electronics supply chains.
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