New Delhi: The government has announced the next edition of India Semiconductor Mission with a broad objective to promote the chip manufacturing ecosystem in the country, covering equipment, materials, indigenous designs and other components that are required to produce the high-tech components.
Finance Minister Nirmala Sitharaman Sunday, without announcing the outlay for the scheme, proposed that the India Semiconductor Mission 2.0 will also focus on industry-led research and training centres to develop technology and a skilled workforce.
“India Semiconductor Mission (ISM) 1.0 expanded India’s semiconductor sector capabilities. Building on this, we will launch ISM 2.0 to produce equipment and materials, design full-stack Indian IP, and fortify supply chains,” she said.
Buoyed by the response to the electronics component manufacturing scheme (ECMS), Sitharaman almost doubled the outlay for it.
“The Electronics Components Manufacturing Scheme, launched in April 2025 with an outlay of Rs 22,919 crore, already has investment commitments at double the target. We propose to increase the outlay to Rs 40,000 crore to capitalise on the momentum,” Sitharaman said.
The Ministry of Electronics and IT has a total of 46 applications till January, entailing a total investment proposal of Rs 54,567 crore and promising to generate direct employment for about 51,000 people.
The scheme has seen participation from Samsung, Tata Electronics, Dixon, Foxconn’s Yuzhan Technology, ATLbattery, Motherson Electronics, Kaynes, Amber Electronics, etc.
Semiconductor industry body IESA President Ashok Chadak said the announcement of ISM 2.0 as a Semiconductor Policy focus, the significant enhancement of the Electronic Component Manufacturing Scheme to Rs 40,000 crore, focused support for MSMEs, capital goods, ease of doing business, and reforms-led manufacturing growth, provides strong continuity and confidence to the industry.
“The expanded focus beyond fabs — covering semiconductor equipment, materials, chemicals, design tools, R&D and training, and supply-chain resilience — will help reduce import dependence and strengthen domestic capabilities and build an end-to-end ecosystem for a sustainable future,” Chandak said.
Broadband gear maker GX Group CEO Paritosh Prajapati said the increase in ECMS outlay signals that ECMS has moved from policy intent to real execution on the ground.
“The focus is no longer limited to assembling finished products but is shifting toward building a strong component ecosystem, which is critical in today’s fragmented global supply chains. Under the expanded outlay, the focus will be on high-value and critical components such as PCBs, power electronics, RF and optical subsystems, semiconductor-adjacent packaging and testing, passive components, precision parts, and strategic materials linked to rare earths,” Prajapati said.
He said the Budget proposal transitions India from assembled in India to engineered and manufactured in India for the world.
Electronics manufacturing services from DBG Technology Director Abhishek Garg said the focused thrust on electronics components manufacturing, skills development and targeted investment incentives will have a multiplier effect across the value chain.
“It will drive capacity expansion, accelerate technology adoption, and enable deeper integration of Indian firms into global supply networks. These measures are expected to reduce import dependence, improve supply-chain resilience and create high-quality employment opportunities. We are encouraged by this forward-looking policy framework that aligns strongly with our commitment to innovation and the ‘Make in India’ vision,” Garg said.
Ai+ Smartphone CEO Madhav Sheth said the Budget is a decisive signal that India is playing for depth, not just scale, in electronics, doubling the push on ECMS and rolling out Semiconductor Mission 2.0 across equipment, materials, supply chains and Indian IP.
“This is how we move from being an assembly base to building a resilient, high-value, India-led ecosystem, de-risking investments in components like display assemblies, camera modules and advanced PCBA, strengthening capital-goods capability through high-tech tool rooms, and cutting import dependence while boosting export competitiveness,” Sheth said.
The government’s policy measures have led to multifold growth in the country’s electronics manufacturing sector.
In FY25, India’s electronics production grew about 19 per cent to Rs 11.3 lakh crore, exports rose 37.5 per cent to Rs 3.3 lakh crore, while imports grew 15 per cent to Rs 8.4 lakh crore on a year-on-year basis.
The mobile manufacturing segment witnessed a nearly 30-fold increase in production value, rising from Rs 18,000 crore in FY15 to Rs 5.45 lakh crore in FY25.
iPhone exports from India have hit Rs 2.03 lakh crore in 2025, which is almost double that of Rs 1.1 lakh crore Apple exported in the calendar year 2024.
Mobile phone production in the country is expected to reach about Rs 6.76 lakh crore, comprising exports over USD 30 billion, or about Rs 2.7 lakh crore, by the end of the current fiscal year.
As of August 2025, 10 semiconductor manufacturing and packaging projects have been approved in the country with a cumulative investment of around Rs 1.6 lakh crore in six states.