India Increases Funding for Semiconductors to Rs 6,903 Crore, Reinforcing Chip Ambitions
The Union Government has once again shown its commitment by allocating a whopping Rs 6,903 crore in the Interim Budget 2024-25. This significant increase follows Rs 3,000 crore in the previous year, reinforcing the government’s resolve to promote the semiconductor and electronics industries.
The declaration is a key part of the government’s ongoing initiatives to elevate India among countries that demonstrate excellence in semiconductor technology. The Rs 76,000 incentive scheme introduced in December 2021 laid the foundation for this renewed focus. The funds allocated now are expected to play a key role in the development of semiconductor and display manufacturing ecosystems.
India Electronics & Semiconductor Association (IESA) President Ashok Chandak lauded the government’s continued support to the sector and said, “Interim Budget 2024 signifies the government’s continued support to the semiconductor and electronics sector and IESA has strongly advocated for Design-led manufacturing that adds value.”
Similarly, Hitesh Garg, Vice President and Managing Director, India, NXP Semiconductors, expressed his enthusiasm for the proactive attitude of the government. “We are excited that Budget 2024 will provide a strong boost to the Indian semiconductor and electronics industry,” Garg said.
He lauded the substantial increase in funding and the 130 percent rise to Rs 6,903 crore, underscoring the government’s commitment to creating an enabling environment for technological development.
Garg sees these strategic moves not only accelerating the growth of the semiconductor industry, but also positioning India as a prime destination for electronic systems engineering and semiconductors globally. “The collaborative spirit and proposed incentives will position India as a global semiconductor hub, reinforcing its commitment to cutting-edge technology advancement,” he added.
However, this momentum also comes at a time when the intersection of artificial intelligence and semiconductors is getting a lot of attention. An AI chip, also known as an AI accelerator, is a specialized type of semiconductor designed specifically to run artificial intelligence algorithms.
Optimized for tasks such as deep learning, inference, and training, these chips offer significant performance and efficiency advantages over traditional CPUs and GPUs.
The government of India’s futureDESIGN DLI scheme recognizes the critical role of artificial intelligence in the semiconductor industry. By providing financial and infrastructural support for chip design, the scheme can directly accelerate the development of such chips in India, home to a large number of chip designers.
Overall, according to the industry, the increased budgetary allocation is in line with India’s efforts to emerge as a major player in the global electronics industry, reflecting a forward-looking approach to promoting research and development.
