India has marked a pivotal milestone in its quest to become a global semiconductor powerhouse as the government announced approval for 23 chip design projects, alongside a substantial Rs 803 crore financial infusion aimed at turbocharging startups and academic innovation in the sector.
The Big Picture: India’s Push for Self-Reliance
Launched in 2021, the India Semiconductor Mission (ISM) is the government’s flagship initiative to establish a full-stack domestic semiconductor ecosystem—from design to fabrication and packaging. With a whopping Rs 76,000 crore ($10 billion) outlay, ISM’s aggressive push seeks to close the gap between India and countries like Taiwan, South Korea, and the U.S. that dominate the chip industry. Experts note that a robust homegrown chip sector is not just an industrial aspiration but a strategic imperative for everything from defense to smartphones and electric vehicles.
Rs 803 Crore: A Catalyst for Innovation
The most recent RS 803 crore sanctioned under the Design Linked Incentive (DLI) Scheme is directed at supporting Indian startups, MSMEs, and academic institutions involved in chip design. The funds cover access to advanced Electronic Design Automation (EDA) tools, IP cores, and the prototyping process—crucial resources that had often been barriers for Indian innovators in the past. Each project can receive up to 50% of eligible costs (capped at Rs 15 crore), with further sales-linked incentives.
Who Benefits? Startups, Colleges, and the Broader Industry
- Startups: 23 Indian startups and firms have been sanctioned support for next-gen chip development. Applications stretch across critical domains—from smart surveillance and energy meters to networking chips and indigenous microprocessor IPs. Ten of these startups have already raised private capital, signaling rising investor faith in Indian hardware innovation.
- Colleges and R&D Institutions: 278 academic and research bodies now have cutting-edge chip-design tools, opening doors for engineering students to build real-world, market-ready solutions. The rollout of specialized learning kits and the inauguration of India’s first 3nm chip design centres in Noida and Bengaluru further cement India’s ambitions in advanced semiconductor technology7.
What Experts & Industry Leaders Are Saying
Industry voices are unanimous: this is not just a numbers game, but about building the entire value chain.
- “With India Semiconductor Mission supporting ‘Design in India’, recent successes will encourage other Indian startups and drive a spirit of bold innovation in hardware,” said IT Minister Ashwini Vaishnaw.
- Experts highlight that India’s deepening electronic design talent now has the resources to compete internationally—if momentum holds, India could see its first mass-market homegrown chips within the next two years.
Key Milestones & Next Steps
1. Startups Lead Commercial Breakthroughs
- 10 VC-Backed Ventures: Startups like Netrasemi (smart vision/CCTV chips) secured ₹107 crore in private funding, while Mindgrove Technologies and Fermionic Design raised ₹85 crore and ₹50 crore, respectively. Cumulatively, DLI-supported firms attracted ₹380 crore in venture capital—a record for India’s semiconductor sector.
- 6 Prototypes Tape-Out: Firms including Morphing Machines and InCore Semiconductors completed chip prototypes at global foundries, advancing toward commercial production.
2. Academia Drives Innovation
- 278 Institutions Empowered: Universities and colleges gained access to advanced Electronic Design Automation (EDA) tools, enabling next-gen R&D.
- 20 Chips Fabricated at Mohali Lab: Designs from 17 institutions were successfully tested at India’s Semiconductor Laboratory (SCL), marking the country’s first academic-to-fab pipeline.
3. DLI Scheme Mechanics Financial Incentive Structure:
| Support Type | Incentive | Cap |
|---|---|---|
| Prototyping Costs | 50% reimbursement | ₹15 crore/project |
| Commercialization | 4-6% of net sales (over 5 years) | ₹30 crore/project |
| EDA Tools/IP Cores | Free access for 72 startups, 278 institutions | — |
Strategic Impact:
- Supply-Chain Diversification: Projects target critical gaps in automotive, telecom, and IoT sectors—areas dominated by foreign chips.
- Talent Pipeline: Over 85,000 engineers are being trained under the India Semiconductor Mission (ISM), leveraging India’s 20% share of global chip design talent.
- Global Integration: SEMICON India 2025 (Sept 2–4, New Delhi) will showcase these designs to 300+ global firms, positioning India as a “trusted semiconductor partner” amid U.S.-China tensions
Challenges Ahead
While the momentum is historic, experts stress the journey is far from over. Semiconductor manufacturing is capital intensive, and global supply chains remain volatile. Successful commercialization depends not only on technical achievement but also on ongoing policy support, global partnerships, and upskilling talent pipelines.
India’s semiconductor mission is entering a decisive phase—backed by record government and private investment, visionary schemes like DLI, and a growing pool of engineering talent. These 23 approved chip designs and Rs 803 crore boost are more than numbers; they represent India’s leap towards technological sovereignty and a prominent role in the global chip value chain.
