Published: 31 October 2025PIB / Carnegie EndowmentScience & Technology
India's Semiconductor Mission: 12 Projects Approved with About ₹1.64 Lakh Crore Investment
As of October 2025, India had approved 10 semiconductor projects across six states under the India Semiconductor Mission (ISM), with total investments exceeding ₹1.6 lakh crore (approximately USD 18–19 billion). The approved projects span fabs, advanced packaging (OSAT/ATMP units), and compound semiconductors. Kaynes Semicon has shipped its first paid chip modules from its OSAT unit at Sanand, Gujarat, targeting both US and domestic customers, marking a significant milestone in India's indigenous chip manufacturing journey.
Rajasthan is also planning to launch a dedicated Semiconductor Policy as part of its upcoming set of 12 new industrial and sectoral policies, aiming to position the state as a key node in India's semiconductor ecosystem. The ISM, launched in 2021, provides incentives of up to 50% for setting up semiconductor fabs. These developments align with India's broader Digital India and Atmanirbhar Bharat goals, reducing dependence on foreign chips for defence, telecommunications, electric vehicles, and consumer electronics sectors.
0Mains angle
Q: Evaluate the progress of the India Semiconductor Mission (ISM) in building domestic chip manufacturing capacity, and discuss its significance for Atmanirbhar Bharat.
Answer (50 words):
Launched in 2021, the India Semiconductor Mission has approved 10 semiconductor projects across six states worth ₹1.6 lakh crore, offering up to 50% fab incentives. Kaynes Semicon shipped first chips from Sanand, Gujarat, reducing import dependence in defence, telecommunications, electric vehicles and electronics under Atmanirbhar Bharat goals.
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CoverageNationalTypeInitiativeSubjectScience & TechnologyExamBasic Computer Instructor · CET Graduation · CET Senior Secondary · EO/RO · LDC · Mahila Supervisor · Patwar · PTI · RAS · REET · RPSC SI · School Lecturer · Senior Computer Instructor · Senior Teacher · UPSC · Vanpal · BothSourcePIB / Carnegie Endowment
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Linked questionMedium
Which Indian company shipped its first paid chip modules from the Sanand, Gujarat OSAT unit under the India Semiconductor Mission?
Explanation · Correct answer DKaynes Semicon shipped its first paid chip modules from its OSAT unit at Sanand, Gujarat, targeting both US and domestic customers — marking a major milestone for India's indigenous chip manufacturing.
Frequently asked questions
What is the India Semiconductor Mission (ISM) and what is its fiscal support structure?
The India Semiconductor Mission (ISM) is the Government of India's initiative to develop a sustainable semiconductor and display manufacturing ecosystem in the country. It provides up to 50% fiscal support under the Design Linked Incentive (DLI) scheme and capital support for fab and ATMP facilities. The government has approved 10 semiconductor projects under ISM with a total investment of ₹1.6 lakh crore, aiming to make India a global semiconductor hub.
Who is Kaynes Semicon and what is the significance of its first chip shipment from Sanand?
Kaynes Semicon is an Indian semiconductor company and a subsidiary of Kaynes Technology. Its facility in Sanand, Gujarat shipped India's first domestically manufactured semiconductor chips, marking a historic milestone in India's journey toward semiconductor self-reliance. This demonstrated that India can now move beyond chip design to actual chip manufacturing — a critical step in developing indigenous semiconductor capabilities.
What dedicated policy is Rajasthan planning for the semiconductor sector and why?
Rajasthan is planning a dedicated Semiconductor Policy to attract chip manufacturing investment to the state. Rajasthan's potential advantages include its improving industrial infrastructure, land availability, existing electronics manufacturing clusters in cities like Jaipur, and its position as a hub for data centres attracted by its solar energy capacity. A dedicated semiconductor policy with state-level incentives would complement central ISM support to attract investors.
What is the full value chain covered by India's approved semiconductor projects?
India's 10 approved semiconductor projects under ISM cover the full semiconductor value chain: chip design (fabless design houses), fabrication (wafer manufacturing fabs), and ATMP — Assembly, Testing, Marking, and Packaging. This full-chain approach is critical because relying only on one segment (like chip design) leaves India dependent on foreign countries for manufacturing, which creates vulnerabilities in the supply chain.
Why is semiconductor self-reliance strategically critical for India?
Semiconductors are the foundational component of all modern electronics — from smartphones and computers to missiles, satellites, and medical devices. India imports nearly $40–50 billion worth of chips annually. Over-dependence on Taiwan and China creates supply chain vulnerabilities, as demonstrated by the global chip shortage of 2020–22 during COVID-19. Indigenous semiconductor capability directly enhances India's national security, economic self-reliance (Aatmanirbhar Bharat), and technological sovereignty.
