India’s second semiconductor mission has moved a step closer to Cabinet consideration after a Finance Ministry panel cleared a proposed outlay of Rs 1.25 lakh crore, according to a CNBCTV-18 report.

The Expenditure Finance Committee is understood to have approved the proposal last week. It will now have to be considered by the Union Cabinet before the expanded scheme can be formally cleared.

The next phase, known as India Semiconductor Mission 2.0, is expected to build on the first programme by widening support across the chipmaking ecosystem. Its focus is likely to include design, fabrication, assembly, testing and packaging, as well as equipment, materials, intellectual property, research and supply-chain development.

The proposed outlay is higher than the Rs 76,000 crore incentive framework approved for the first phase of the mission in December 2021.

Under the existing programme, the government has approved 12 semiconductor projects, including fabrication, compound semiconductor, assembly, testing and packaging facilities, with cumulative investments of about Rs 1.64 lakh crore.

Official material on the mission said India is expected to develop the capability to design and manufacture chips required for nearly 70–75% of domestic applications by 2029.

The India Semiconductor Mission is the Centre’s flagship programme to develop a domestic chip ecosystem and position the country as a global hub for electronics manufacturing and design.

The expanded scheme is also expected to support ancillary industries such as industrial gases, specialty chemicals, capital equipment, MSMEs and other suppliers, as India seeks to reduce its dependence on imported semiconductors and strengthen its place in global electronics supply chains.