Finance Ministry clears Rs 1.25 lakh crore semiconductor mission 2.0

NEW DELHI: The expenditure department under the Finance Ministry has cleared a Budget proposal entailing an allocation of Rs 1.25 lakh crore for India Semiconductor Mission 2.0, as the country looks to advance global chip-making ambitions and cement its position as a semiconductor destination for the world, according to sources.

The approval is significant as it is higher than the outlay of Rs 76,000 crore earmarked for ISM 1.0.

Sources said that the Expenditure Finance Committee has greenlit the Rs 1.25 lakh crore outlay for ISM 2.0, and that the same will be placed before the Cabinet.

The Budget, in February, had sought to give a big boost to the country’s manufacturing prowess announcing, among various measures, the second edition of India Semiconductor Mission with a broad objective to promote chip manufacturing ecosystem in the country covering equipment, materials, indigenous designs and other related components.

The government has maintained that India Semiconductor Mission 2.0 - announced in the Union Budget 2026-27 - signals India’s deep commitment to chip manufacturing, with a focus on semiconductor equipment, materials, indigenous intellectual property and resilient supply chains.

Terming the semiconductor advances as India’s “long-time dream”, a senior IT Ministry official said 12 semiconductor manufacturing projects have been approved, two of which have been inaugurated for commercial manufacture earlier this year. Another one - CG Semi - is likely to get inaugurated later this week.

“CG Semi’s inauguration is scheduled for July 4...and then probably one or two more (will happen) before the end of this calendar year, so our dream of having commercial semiconductor manufacturing in the country has finally been achieved,” the IT Ministry official said.