The India Semiconductor Mission (ISM) is a transformative government initiative, established as an independent business division within the Digital India Corporation, with administrative and financial autonomy. It was launched in December 2021 by the Union Cabinet with a total financial outlay of ₹76,000 crore (approximately $10 billion) under the Ministry of Electronics and Information Technology (MeitY). The mission's origin lies in the need to reduce India's reliance on imported semiconductor chips and establish a robust, self-reliant electronics manufacturing ecosystem, addressing the problem of uneven past efforts and strengthening supply chain security.
The ISM functions as the nodal agency for the efficient implementation of schemes to develop a sustainable semiconductor and display ecosystem. Its mechanism involves providing fiscal support to companies investing in the sector through schemes like the one for setting up Semiconductor Fabs, which offers up to 50% of the project cost on a pari-passu basis to approved applicants. Other key provisions include schemes for Display Fabs, Compound Semiconductors/ATMP (Assembly, Testing, Marking, and Packaging) facilities, and the Design Linked Incentive (DLI) scheme to bolster chip design capabilities. The mission connects directly to the broader national goal of Atmanirbhar Bharat (Self-Reliant India) and the push for a resilient global electronics value chain.
The mission has recently evolved into India Semiconductor Mission 2.0, which was indicated in the Union Budget 2026-27. While the initial phase (ISM 1.0) focused on attracting fabrication and ATMP projects, the new phase broadens support to the ecosystem by prioritizing indigenous chip design, productization, and the domestic production of critical inputs like specialty chemicals, industrial gases, and semiconductor equipment. This shift aims to consolidate the ecosystem and deepen domestic capabilities, moving India from a consumer to a global manufacturing and innovation hub.