Centre Looking To Extend Fiscal Support To Eight Years Under Semicon Mission

SUMMARY

The government is reportedly looking to extend the fiscal support period under the second phase of the ISM to eight years from the current five years

As per ET’s report, the approved projects of applicants under ISM phase-II may also receive additional financial grants

The second phase of the mission may withdraw financial support for technology transfer costs, and instead raise the outlay for administrative expenses

The government is reportedly looking to extend the fiscal support period under the second phase of the India Semiconductor Mission (ISM) to eight years from the current five years.

As per ET’s report, citing a senior government official, the approved projects of applicants under ISM phase-II may also receive additional financial grants.

These financial grants would include skill training provision for employees, additional interest-free loan and help from the Ministry of Electronics and Information Technology (MeitY) for preferential supply of domestically manufactured and packaged chips, the official said.

In the phase-I of the ISM, the government received constant feedback from the industry and many global experts. However, the second phase of the mission may withdraw the financial support for technology transfer costs, and instead raise the outlay for administrative expenses, the official was quoted as saying in the report.

The new development comes a few months after MeitY Secretary S Krishnan revealed the plans to seek more funds for its semiconductor mission.

In 2021, the government introduced the Semicon India program, allocating INR 76,000 Cr to provide incentive support to companies of the sector.

Following that, the India Semiconductor Mission (ISM) was launched in 2022 to cultivate a robust semiconductor and display ecosystem, aiming to position India as a prominent global hub for electronics manufacturing and design.

The semiconductor space is turning to become a potential market with the ‘Make in India’ initiative. The initiative was brought in with a vision to reduce dependency on imported components and bolster the domestic tech ecosystem. This turned out to become a driving force behind these initiatives in recent years.

As per Inc42 report, the homegrown semiconductor space is expected to reach a market size of $150 Bn by 2030.

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