India Unveils ISM 2.0: A Strategic Push for Semiconductor Self-Reliance

India is gearing up to launch the next phase of its ambitious semiconductor strategy, known as India Semiconductor Mission (ISM) 2.0, according to S Krishnan, Secretary of the Ministry of Electronics and Information Technology (MeitY). The revamped initiative aims to bolster India's position in the global semiconductor landscape with a more targeted approach focusing on three key areas: new fabrication facilities, advanced packaging, and design-led innovation.

Expanding Fabrication Capabilities

A cornerstone of ISM 2.0 is the establishment of more semiconductor fabrication facilities (fabs) across the country. This move is designed to reduce India's dependence on foreign manufacturers and achieve greater self-reliance in electronics manufacturing. By increasing domestic fab capacity, India aims to move up the value chain in semiconductor packaging and production.

Advanced Packaging Initiatives

The strategy also places significant emphasis on advanced packaging technologies. As semiconductor designs become more complex, advanced packaging plays a crucial role in enhancing performance and efficiency. By focusing on this area, India seeks to position itself as a key player in the high-value segments of the semiconductor supply chain.

Design-Linked Incentive Scheme 2.0

A major component of ISM 2.0 is the revamped Design-Linked Incentive (DLI) scheme. The new version of the DLI is set to be more attractive for fabless companies, offering:

• Access to risk capital
• Scaling frameworks for growth
• Focus on specific sub-segments

The enhanced DLI scheme aims to foster innovation and encourage the development of real products and systems originating from India. This targeted approach is expected to stimulate the growth of India's semiconductor design ecosystem.

Industry Enthusiasm

Secretary Krishnan noted strong enthusiasm from both domestic and foreign companies eager to explore opportunities in India's evolving semiconductor landscape. This interest from industry players suggests that ISM 2.0 could catalyze significant investments and partnerships in the sector.

Strategic Implications

ISM 2.0 represents a strategic shift in India's approach to semiconductor development. By focusing on fabrication, advanced packaging, and design innovation, the government aims to create a comprehensive ecosystem that can compete on a global scale. This initiative not only targets self-reliance in critical technology but also positions India as a potential hub for semiconductor manufacturing and innovation.

As the global demand for semiconductors continues to grow, India's push to strengthen its domestic capabilities could have far-reaching implications for the international electronics supply chain. The success of ISM 2.0 could potentially alter the dynamics of the global semiconductor industry, offering new opportunities for collaboration and competition in this crucial tech sector.