The Cabinet on Wednesday approved two major manufacturing initiatives with a combined outlay of nearly Rs 1.9 lakh crore ($22 billion) to expand India’s semiconductor ecosystem, scale up mobile phone production and to strengthen its position as a global electronics manufacturing hub.The government cleared a Rs 1,27,500-crore Semicon 2.0 programme to accelerate semiconductor design and manufacturing capabilities.Recognising the need for sustained, long-term support for the semiconductor sector and building on the momentum generated under Semicon 1.0, Semicon 2.0 aims to further the government’s commitment to placing India on the global semiconductor map.Semicon 2.0 will build on the initial success in chip design. With 105 startups already developing chips, the focus will be on deepening the design ecosystem. In addition, key building blocks have been identified for the development of strategic and commercial products.Under the programme, the objective is to develop intellectual property (IP), chip designs and systems through this approach.“We will be self-reliant in indigenous chip production by the end of this programme,” Minister for Electronics and Information Technology Ashwini Vaishnaw said.The programme will help position India as a leading semiconductor chip design and IP hub.Companies engaged in the manufacturing and R&D of semiconductor equipment, as well in the production of materials, chemicals and gases essential for fabrication, will be incentivised.This will lay the foundation for sustainable growth of the semiconductor industry and support the development of a precision manufacturing ecosystem in the country.With the first semiconductor fabrication plant scheduled to be commissioned in 2028, global confidence in India’s semiconductor strategy is rising. Efforts will be made to attract more manufacturers to establish fabrication facilities in India.The Cabinet also approved a Rs 62,500-crore Mobile Phone Manufacturing Scheme to provide production-linked incentives to manufacturers over five years from fiscal year 2026-27 to 2030-31.Incentives will range from 2.25 per cent to 5 per cent on eligible mobile phone sales, with additional support for domestic sourcing of key components and for Indian companies investing in product design and research.The government expects the scheme to drive cumulative production of around Rs 39 lakh crore during its tenure, significantly boost exports and generate about 60,000 direct jobs.India has emerged as the world’s second-largest mobile phone manufacturer by volume, with 99.2 per cent of handsets used domestically now produced within the country. Mobile phones became India’s largest export product category in 2025, overtaking traditional segments such as diesel fuel and cut diamonds.