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2 Feb 2026·Source: The Hindu
4 min
EconomyScience & TechnologyNEWS

Semiconductor Mission 2.0 Launched; Electronics Component Scheme Outlay Doubled

India unveils Semiconductor Mission 2.0, doubles electronics component manufacturing scheme outlay.

Semiconductor Mission 2.0 Launched; Electronics Component Scheme Outlay Doubled

Photo by Maxence Pira

Union Finance Minister Nirmala Sitharaman announced the launch of India Semiconductor Mission (ISM) 2.0 and the doubling of the Electronics Component Manufacturing Scheme (ECMS) outlay. The ECMS outlay has been increased from ₹22,805 crore to ₹40,000 crore. The ECMS application window is open until 2027 for indigenously manufactured capital machinery to make components. ISM 2.0 aims to produce equipment and materials, design full-stack Indian IP, and fortify supply chains. ISM 1.0 had an outlay of ₹76,000 crore.

Key Facts

1.

ECMS outlay increased: ₹22,805 crore to ₹40,000 crore

2.

ECMS application window: Open until 2027

3.

ISM 1.0 outlay: ₹76,000 crore

UPSC Exam Angles

1.

GS Paper III: Indian Economy - Industrial Policy

2.

Connects to Make in India initiative and Atmanirbhar Bharat

3.

Potential for questions on government schemes and technology

Visual Insights

Key Figures: Semiconductor Mission 2.0 and ECMS

Highlights of the India Semiconductor Mission 2.0 and the increased outlay for the Electronics Component Manufacturing Scheme (ECMS).

ECMS Outlay
₹40,000 crore+₹17,195 crore

Increased investment to boost domestic electronics component manufacturing.

ISM 1.0 Outlay
₹76,000 crore

Initial investment in the India Semiconductor Mission.

More Information

Background

The semiconductor industry's roots can be traced back to the mid-20th century with the invention of the transistor at Bell Labs in 1947. This invention revolutionized electronics, paving the way for smaller, faster, and more energy-efficient devices. The development of the integrated circuit (IC) in the late 1950s further accelerated the growth of the industry. These early innovations laid the foundation for the modern semiconductor ecosystem. Over the decades, the semiconductor industry has experienced significant advancements in manufacturing processes, design methodologies, and materials science. Moore's Law, which predicted the doubling of transistors on a microchip approximately every two years, has driven much of this progress. The industry has also become increasingly globalized, with different regions specializing in various aspects of the semiconductor value chain, such as design, manufacturing, and testing. This globalization has created complex interdependencies and supply chain vulnerabilities. Government policies have played a crucial role in shaping the semiconductor industry. Countries like the United States, Japan, South Korea, and Taiwan have implemented various incentives, including tax breaks, subsidies, and research funding, to support their domestic semiconductor industries. These policies have aimed to foster innovation, attract investment, and ensure national security. In India, the recent launch of the India Semiconductor Mission (ISM) and the doubling of the Electronics Component Manufacturing Scheme (ECMS) outlay are examples of such policy interventions.

Latest Developments

The global semiconductor industry is currently facing several challenges, including supply chain disruptions, geopolitical tensions, and increasing demand for advanced chips. The COVID-19 pandemic has exacerbated these challenges, leading to shortages of semiconductors and impacting various sectors, such as automotive, electronics, and healthcare. Governments around the world are responding to these challenges by implementing policies to strengthen their domestic semiconductor industries and reduce their reliance on foreign suppliers. The CHIPS Act in the United States is one such example. In India, the government is actively promoting the development of a domestic semiconductor ecosystem through various initiatives, including the India Semiconductor Mission (ISM) and the Electronics Component Manufacturing Scheme (ECMS). These initiatives aim to attract investment, foster innovation, and create jobs in the semiconductor industry. The government is also working to address the challenges related to infrastructure, talent development, and regulatory framework. The success of these efforts will depend on the ability to create a conducive environment for semiconductor manufacturing and innovation. The future of the semiconductor industry is likely to be shaped by several key trends, including the increasing demand for artificial intelligence (AI), the growth of the Internet of Things (IoT), and the development of advanced packaging technologies. These trends will require new materials, designs, and manufacturing processes. The industry will also need to address the challenges related to sustainability, energy efficiency, and cybersecurity. Collaboration between governments, industry, and academia will be essential to navigate these challenges and capitalize on the opportunities.

Frequently Asked Questions

1. What is the India Semiconductor Mission (ISM) 2.0, and why is it important?

The India Semiconductor Mission (ISM) 2.0 aims to boost the semiconductor industry by focusing on equipment and materials production, designing Indian Intellectual Property (IP), and strengthening supply chains. It is important because it aims to make India self-reliant in semiconductor technology.

2. What are the key objectives of the Electronics Component Manufacturing Scheme (ECMS)?

The Electronics Component Manufacturing Scheme (ECMS) aims to boost the domestic manufacturing of electronic components. The scheme's outlay has been increased to ₹40,000 crore, and the application window is open until 2027 for indigenously manufactured capital machinery to make components.

3. What is the total outlay for ISM 1.0 and the revised outlay for ECMS?

The total outlay for ISM 1.0 was ₹76,000 crore. The Electronics Component Manufacturing Scheme (ECMS) outlay has been increased from ₹22,805 crore to ₹40,000 crore.

Exam Tip

Remember these figures for Prelims - they are important for government schemes.

4. Who announced the launch of India Semiconductor Mission (ISM) 2.0 and the doubling of the ECMS outlay?

Union Finance Minister Nirmala Sitharaman announced the launch of India Semiconductor Mission (ISM) 2.0 and the doubling of the Electronics Component Manufacturing Scheme (ECMS) outlay.

5. What are the potential benefits and drawbacks of the Semiconductor Mission 2.0 for India?

The Semiconductor Mission 2.0 aims to make India a global hub for semiconductor manufacturing, potentially boosting the economy and creating jobs. However, the high initial investment and the need for skilled labor could be potential drawbacks.

6. Why is the semiconductor industry currently facing challenges, and how does ISM 2.0 address them?

The global semiconductor industry is facing supply chain disruptions and increasing demand. ISM 2.0 aims to address these challenges by fortifying supply chains and promoting domestic manufacturing of equipment and materials.

7. How does the Electronics Component Manufacturing Scheme (ECMS) support the 'Make in India' initiative?

The ECMS supports the 'Make in India' initiative by incentivizing domestic manufacturing of electronic components. The scheme encourages companies to set up or expand their manufacturing facilities in India, reducing reliance on imports.

8. What are the key facts to remember about the ECMS application window for the UPSC Prelims exam?

The ECMS application window is open until 2027. This is crucial for companies planning to invest in indigenous capital machinery for component manufacturing. Remember the deadline for the exam.

Exam Tip

Note the year 2027 - it could be a potential MCQ.

9. What reforms are needed to further strengthen the semiconductor ecosystem in India?

Further reforms could include streamlining the approval processes for setting up manufacturing units, providing additional incentives for research and development, and investing in skill development programs to create a skilled workforce.

10. Why is the Semiconductor Mission 2.0 in the news recently?

The Semiconductor Mission 2.0 is in the news due to the Union Finance Minister's announcement of its launch and the doubling of the Electronics Component Manufacturing Scheme (ECMS) outlay. These developments signal the government's commitment to boosting the semiconductor industry in India.

Practice Questions (MCQs)

1. Consider the following statements regarding the Electronics Component Manufacturing Scheme (ECMS): 1. The scheme aims to boost domestic manufacturing of electronic components and semiconductors. 2. The application window for the ECMS is open until 2027 for indigenously manufactured capital machinery to make components. 3. The outlay for ECMS has been doubled to ₹40,000 crore under Semiconductor Mission 2.0. Which of the statements given above is/are correct?

  • A.1 and 2 only
  • B.2 and 3 only
  • C.1 and 3 only
  • D.1, 2 and 3
Show Answer

Answer: D

All the statements are correct. The ECMS aims to boost domestic manufacturing of electronic components and semiconductors. The application window is open until 2027 for indigenously manufactured capital machinery. The outlay has been doubled to ₹40,000 crore under Semiconductor Mission 2.0, as stated in the news summary.

2. Which of the following statements best describes the primary objective of the India Semiconductor Mission (ISM) 2.0?

  • A.To solely focus on attracting foreign investment in semiconductor manufacturing.
  • B.To produce equipment and materials, design full-stack Indian IP, and fortify supply chains in the semiconductor industry.
  • C.To promote the import of semiconductors to meet domestic demand.
  • D.To provide subsidies only to large multinational corporations in the semiconductor sector.
Show Answer

Answer: B

Option B is the correct answer. According to the news summary, ISM 2.0 aims to produce equipment and materials, design full-stack Indian IP, and fortify supply chains. The other options are incorrect as they do not fully represent the comprehensive objectives of the mission.

3. With reference to the semiconductor industry, consider the following: 1. Silicon is the most widely used semiconductor material due to its abundance and suitable electrical properties. 2. Moore's Law predicts the doubling of transistors on a microchip approximately every year. 3. The semiconductor industry is highly capital-intensive, requiring significant investments in research, development, and manufacturing. Which of the statements given above is/are correct?

  • A.1 and 2 only
  • B.1 and 3 only
  • C.2 and 3 only
  • D.1, 2 and 3
Show Answer

Answer: B

Statements 1 and 3 are correct. Silicon is indeed the most widely used semiconductor material. The semiconductor industry is highly capital-intensive. Statement 2 is incorrect because Moore's Law predicts the doubling of transistors approximately every TWO years, not every year.

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