Lok Sabha Question No. 2594 (UNSTARRED), answered on 2024-08-07
Subject: Incentive for Semiconductor and Display Ecosystem
Ministry: ELECTRONICS AND INFORMATION TECHNOLOGY
Asked by: Prof. Sougata Ray

## GOVERNMENT OF INDIA MINISTRY OF ELECTRONICS AND INFORMATION TECHNOLOGY

## LOK SABHA

## UNSTARRED QUESTION NO.2594

TO BE ANSWERED ON: 07.08.2024

## INCENTIVE FOR SEMICONDUCTOR AND DISPLAY ECOSYSTEM

## 2594.  PROF. SOUGATA RAY:

Will the Minister of ELECTRONICS AND INFORMATION TECHNOLOGYbe pleased to state:

- (a) whether  the  Government  has  released  funds/incentives  for  the  development  of sustainable semiconductor and display ecosystem;
- (b) if so, the details thereof;
- (c) whether any State Government has participated in the same as a stakeholder; and
- (d) if so, the details thereof along with the proposed ratio of subsidy to be awarded for the manufacturers of the components for the semiconductor?

## ANSWER

## MINISTER OF STATE FOR ELECTRONICS AND INFORMATION TECHNOLOGY (SHRI JITIN PRASADA)

- (a) to (d):Steps taken by Government to encourage domestic manufacturing of semiconductors in the country are as follows:
- (i) Government has approved Semicon India programme with a total outlay of INR 76,000 crore  for  the  development  of  semiconductor  and  display  manufacturing  ecosystem  in the country. The programme aims to provide financial support to companies investing in semiconductors, display manufacturing and design ecosystem.

Following four schemes have been introduced under the aforesaid programme:

- a) ' Modified Scheme for setting up of Semiconductor Fabs in India ' extends a fiscal support of 50% of the project cost on pari-passu basis for setting up of Silicon CMOS based Semiconductor Fabs in India.
- b) ' Modified Scheme for setting up of Display Fabs in India ' extends fiscal support of 50% of Project Cost on pari-passu basis for setting up of Display Fabs in India.
- c) ' Modified  Scheme  for  setting  up  of  Compound  Semiconductors  /  Silicon Photonics  /  Sensors  Fab  /  Discrete  Semiconductors  Fab  and  Semiconductor Assembly, Testing, Marking and Packaging (ATMP) / OSAT facilities in India' extends a fiscal  support  of  50%  of  the  Capital  Expenditure  on pari-passu basis  for setting  up  of  Compound  Semiconductors  /  Silicon  Photonics  (SiPh)  /  Sensors (including  MEMS)  Fab/  Discrete  Semiconductor  Fab  and  Semiconductor  ATMP  / OSAT facilities in India.
- d) 'Design Linked Incentive (DLI) Scheme': In  addition  to  the  design  infrastructure support, the scheme provides 'Product Design Linked Incentive' of up to 50% of the eligible expenditure subject to a ceiling of ₹15 Crore per application and 'Deployment  Linked  Incentive'  of  6%  to  4%  of  net  sales  turnover  over  5  years subject to a ceiling of ₹30 Crore per application.
- e) Government has also approved modernisation of Semi-Conductor Laboratory, Mohali as a brownfield Fab.

4  semiconductor  units  with  cumulative  investment  of  Rs  1,48,746  Cr  have  been  approved under  the  Semicon  India  Programme.  Few  states  have  announced  policies  to  promote investment in electronics and semiconductor manufacturing in their states.

Further, Government has been implementing following programs focused on development of electronics manufacturing and components ecosystem:

- (i) The Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors  (SPECS)  was  notified  on  01.04.2020  and  was  open  to  receive applications  upto  31.03.2024.  The  scheme  provides  a  financial  incentive  of  25%  on capital expenditure for electronic components, e-waste recycling, mechanics, micro/nano-electronic  components,  solar  photovoltaic  (SPV)  polysilicon,  SPV  wafers and  solar  cells,  specialized  sub-assemblies  and  capital  goods  for  manufacture  of aforesaid goods. As of, 30.06.2024, incremental investment of      Rs. 8,803.14 crores had been made under the SPECS scheme. This has led to production of Rs. 18,083.55 crores till 30 th June,2024
- (ii) Production  Linked  Incentive  (PLI)  Scheme  for  Large  Scale  Electronics : To  boost domestic manufacturing and attract investment in mobile phones value chain including electronic  components  and  semiconductor  packaging,  Production  Linked  Incentive Scheme (PLI) for Large Scale Electronics Manufacturing was notified on 01.04.2020. The scheme extends an incentive of 3% to 6% on incremental sales (over base year) of goods manufactured in India and covered under target segments viz. Mobile Phones and Specified Electronic Components, to eligible companies, for a period of 5  years. Till 30th June, 2024, incremental investment of Rs 8,390 Crores had been made under the PLI scheme. This has led to production of Rs 5,14,960 Crores till 30th June, 2024.

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