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India Bets Big: ₹1.27 Lakh Cr Chip Mission Launched
16 Jul
Summary
- Second phase of India Semiconductor Mission approved with ₹1.27 lakh crore.
- New Mobile Phone Manufacturing Scheme allocated ₹62,500 crore.
- Schemes aim to boost domestic value addition and job creation.
The Union Cabinet has given its approval for the ₹1.27 lakh crore India Semiconductor Mission (ISM) second phase and a new ₹62,500 crore Mobile Phone Manufacturing Scheme (MPMS). These crucial initiatives are set to propel India's electronics manufacturing sector forward, with administrative notifications expected within the next fortnight.
ISM 2.0 is anticipated to attract substantial investments, driving significant production and exports over its six-year tenure. The Mobile Phone Manufacturing Scheme, designed to extend support for five years, will offer incentives based on domestic sourcing and indigenous design capabilities. This aims to increase the domestic value addition in smartphones from the current 24% to an ambitious 40-45% by the scheme's conclusion.
The government expects the MPMS to cumulatively generate ₹39 lakh crore in mobile phone production and ₹15 lakh crore in exports, while creating approximately 600,000 new direct jobs. The previous production-linked scheme for mobile phones was highly successful, exceeding production and export targets and creating 1.2 million jobs.
ISM 2.0 encompasses the entire semiconductor ecosystem, from raw materials to finished components, with reduced but targeted incentives compared to the first phase. The focus areas include chip design, machinery, materials, fabrication units, and assembly, testing, marking, and packaging (ATMP).
