Union Budget 2024 Allocates Rs 6,903 Cr To Strengthen Semiconductor Ecosystem
This is a 355 per cent increase compared to the revised estimates of Rs 1,503.36 crore for the previous fiscal year 2023-24
The Union Budget 2024 has allocated Rs 6,903 crore to the Ministry of Electronics and Information Technology (MeitY) for the “Modified Programme for Development of Semiconductors and Display Manufacturing Ecosystem in India.”
This is a 355 per cent increase compared to the revised estimates of Rs 1,503.36 crore for the previous fiscal year 2023-24.
A considerable portion of this funding, amounting to Rs 4,203 crore, is earmarked for the “Modified Scheme for setting up of Compound Semiconductors/Silicon Photonics/Sensors Fab/Discrete Semiconductors Fab and Semiconductor Assembly, Testing, Marking and Packaging (ATMP)/Outsourced Semiconductor Assembly and Test (OSAT) facilities in India.”
By offering significant incentives, the government aims to attract major industry players like Micron and Tata Electronics to set up their manufacturing facilities in the country. These incentives are expected to spur growth in large-scale electronics manufacturing and IT hardware production, contributing to India's strategic positioning in the global semiconductor market.
Ashok Chandak, President, IESA welcomed the initiatives but cautioned regarding China’s FDI in this strategically vital sector. “Any move to relax FDI norms for China in electronics and semiconductors could potentially stifle the emerging electronics components industry and have long-term implications for the telecom, defence, and aerospace sectors which are crucial for India’s security.”
“IESA is working with MeitY on the new National Policy on Electronics and hope some of the measures for product development in the Electronics and Semiconductors verticals, Increased support toward enhancing local value addition and PLI for electronic components would get covered,” he added.
