Strengthening India's position in global electronics manufacturing

Building on the success of the first phase of the Semicon India Programme, the Union Cabinet has notified Semicon India 2.0 with an outlay of INR 1,27,500 crore. The programme strengthens the semiconductor ecosystem by expanding support beyond chip design and fabrication to include equipment manufacturers, material suppliers, advanced packaging providers, speciality chemical manufacturers, industrial gas producers and technology service providers. The scheme will remain open for applications for an initial period of three years, with project duration determined on a case-to-case basis, up to six years. The programme aims to: 

• Build resilient domestic semiconductor supply chains.
• Reduce strategic vulnerabilities.
• Improve global supply chain stability.
• Increase domestic value addition over time.

With an outlay of INR 62,500 crore, MPMS is designed to strengthen India's mobile manufacturing ecosystem by encouraging domestic sourcing, innovation and the development of globally competitive Indian brands. The guidelines have been issued by MeitY. The programme is structured around two target segments: incentivising mobile phone manufacturing and supporting Indian mobile phone brands. The programme includes:

• For mobile phone manufacturing, eligible sales up to the average growth over FY 2024-26 above baseline receive a tapered incentive of 2.25% to 2.75%, while additional eligible sales above the specified threshold are incentivised on a tapering basis of 4% to 5%.
• For Indian mobile phone brands, an incentive of 5% of eligible sales, plus an additional 3% for Indian design and R&D.
• Separately, a domestic sourcing top-up of up to 1.5% of eligible sales is available where localisation reaches at least 25% of total mobile phone units sold.
• A five-year implementation period from FY2026-27 to FY2030-31, with an optional one-year gestation period for the brand-support track.
• Quarterly claims permitted, subject to eligibility conditions.

Expected outcomes

• Mobile phone production is expected to reach approximately INR 39,00,000 crore.
• Around 60,000 direct jobs are expected to be generated.

Eligibility and computation at a glance

• Eligibility: Mobile phone manufacturers and Electronics Manufacturing Services (EMS) firms registered in India. For the brand-support track: new and existing brands registered in India with minimum INR 10,000 crore annual sales in FY2025-26 and INR 5,000 crore YoY incremental sales each year; or minimum turnover of INR 1,000 crore in FY2025-26, Indian-owned IP or trademark, at least 51% Indian ownership and control, and in-house R&D in India
• Basis for computation: Baseline sales set at prior financial year sales plus 15%, with brand-wise computation and performance years from FY2026-27 onwards. For the manufacturing segment, eligible sales are measured as incremental sales over the baseline.