Cabinet approves Semicon 2.0 - Government delivers on its commitment for a long-term policy support to Semiconductors in India

Key Highlights:

• The Union Cabinet has approved Semicon 2.0 with a total budget outlay of ₹1,27,500 crore.
• This initiative aims to develop India's semiconductor design and manufacturing ecosystem.
• Semicon 2.0 builds upon the momentum generated by Semicon 1.0 and provides long-term policy support.
• It is structured around six pillars: design, machines and materials, setting up more fabs, strengthening ATMP/OSAT industry, R&D, and talent development.
• Under Indian Semiconductor Mission (ISM 1.0), 12 manufacturing units were approved with over ₹1.64 Lakh Crore investment.

Detailed Insights:

• The approval signifies the government's commitment to positioning India as a global hub for semiconductor technology.
• Semicon 2.0 focuses on deepening the chip design ecosystem, leveraging the initial success of 105 startups already developing chips.
• Incentives will be provided to companies involved in manufacturing and R&D of essential machines, materials, chemicals, and gases for semiconductor production.
• The plan includes attracting more manufacturers to establish various types of fabs, such as silicon, compound semiconductor, discrete component, and display fabs.
• Efforts will be made to bring advanced ATMP/OSAT technologies to India, building on the success of existing units.
• Research and Development will target advanced nodes and technologies, collaborating with leading R&D centers globally and domestically.
• Talent development will enhance training for students in complex chip design and industry-specific skills like clean room operations.
• ISM 1.0 saw the approval of a Silicon fab, a Silicon Carbide fab, an integrated Gallium Nitride Micro LED Display Fab, and nine packaging units.
• Companies like Micron, Kaynes, and CG Semi have already commenced commercial production under ISM 1.0.
• Under ISM 1.0, 24 semiconductor design projects from startups and MSMEs received financial support, and 105 gained access to Electronic Design Automation (EDA) tools.

Key Concepts Involved:

• Semiconductor: A material with electrical conductivity between a conductor and an insulator, forming the basis of modern electronics.
• Fab (Fabrication Plant): A facility where semiconductor devices, such as integrated circuits, are manufactured.
• ATMP/OSAT (Assembly, Test, Mark, and Pack / Outsourced Semiconductor Assembly and Test): Processes involved in packaging and testing semiconductor chips after they are fabricated.
• Electronic Design Automation (EDA) tools: Software tools used for designing, verifying, and manufacturing electronic systems, including integrated circuits.