Semiconductor Industry in India: Incentives and Key Players

Published 2 days ago• 4 minute read

India is actively exploring the potential of two-dimensional (2D) materials as a transformative leap in semiconductor innovation, according to a news report published by CNBC TV18 on June 30, 2025. The news report, citing a senior central government official, states that 2D materials are being recognized internationally as a critical frontier in semiconductor technology, and India is keen to position itself early in this emerging field

In contrast to the present 3nm chips produced by major players like Apple, Samsung, MediaTek, and Intel, chips built using 2D materials could surpass current size and performance limitations. The 2D materials—comprising layers just a few atoms thick—could enable the development of much smaller, faster, and more energy-efficient chips. Materials such as graphene, phosphorene, and transition metal dichalcogenides (TMDs) are at the forefront of global research in this domain.

At present, no country or company has achieved commercial-scale production of 2D material-based chips. Nonetheless, research efforts are underway in countries like the US, China, the UK, Germany, and Japan. India is now looking to become an early entrant in this high-potential space.

Reports indicate that India is preparing to issue a call for Expressions of Interest (EoIs) from both academic institutions and private industry. The objective is to facilitate the establishment of research and development hubs and pilot fabrication units dedicated to 2D materials.

This initiative is part of India’s broader ambition to become a global semiconductor innovation and manufacturing hub. The push toward 2D materials acknowledges that long-term competitiveness may depend on technologies that extend beyond today’s fabrication capabilities.


Modified scheme for setting up of semicon fabs in India	TEPL (commercial fab)	915.26	679.56	339.78
Modified scheme for setting up of compound semicon/silicon photonics/sensors fab and semicon/ATMP/OSAT facilities in India	Micron Technology Inc. (ATMP)	225.16	225.16	112.58
	TEPL (OSAT)	271.20	204.49	102.25
	CG Power & Industrial Solutions Ltd. (ATMP)	75.84	70.02	35.01

(Source: Indian Express using Government of India’s internal documents)

Semiconductor scheme in India	Government notification	Application form and submission guidelines
Scheme for setting up of Semiconductor Fabs in India	Link to PDF: Gazette Notification on Tuesday, December 21, 2021.	Link to PDF: Released December 30, 2021
Scheme for setting up of Display Fabs in India	Link to PDF: Gazette Notification on Tuesday, December 21, 2021.	Link to PDF: Released December 30, 2021
Scheme for setting up of Compound Semiconductors / Silicon Photonics / Sensors Fab and Semiconductor Assembly, Testing, Marking and Packaging (ATMP) / OSAT facilities in India	Link to PDF: Gazette Notification on Tuesday, December 21, 2021.	Link to PDF: Released December 30, 2021
Design Linked Incentive (DLI) Scheme 3 components: Deployment Linked Incentive	Link to PDF: Gazette Notification on Tuesday, December 21, 2021.	Link to PDF: Gazette Notification on Thursday, December 30, 2021. Link to Press Release dated January 16, 2022: Applications invited under the Design Linked Incentive (DLI) Scheme from domestic semiconductor chip design firms A dedicated portal has been made available – www.chips-dli.gov.in – for inviting online applications from January 1, 2022 to December 31, 2024. The applicants can find the guidelines of the DLI Scheme on the portal and register themselves for availing support under the scheme.

On September 21, 2022, the Cabinet, chaired by Prime Minister Narendra Modi, approved key modifications to the Program for Development of Semiconductors and Display Manufacturing Ecosystem in India:

Under the modified program, a uniform fiscal support of 50 percent of project cost shall be provided across all technology nodes for setting up of semiconductor fabs. Given the niche technology and nature of compound semiconductors and advanced packaging, the modified program shall also provide fiscal support of 50 percent of capital expenditure in pari-passu mode for setting up of compound semiconductors/silicon photonics/sensors / discrete semiconductors fabs and ATMP/OSAT.

This article was originally published on April 6, 2021. It was last updated July 3, 2025.

About Us

India Briefing is one of five regional publications under the Asia Briefing brand. It is supported by Dezan Shira & Associates, a pan-Asia, multi-disciplinary professional services firm that assists foreign investors throughout Asia, including through offices in Delhi, Mumbai, and Bengaluru in India. Readers may write to [email protected] for support on doing business in India. For a complimentary subscription to India Briefing’s content products, please click here.

Dezan Shira & Associates also maintains offices or has alliance partners assisting foreign investors in China, Hong Kong SAR, Dubai (UAE), Indonesia, Singapore, Vietnam, Philippines, Malaysia, Thailand, Bangladesh, Italy, Germany, the United States, and Australia.