India's Design Linked Incentive (DLI) scheme under the Semicon India Programme is demonstrating robust growth, with supported projects achieving 16 tape-outs, fabrication of six ASIC chips, filing of 10 patents, engagement of over 1,000 engineers, and leveraging more than three times private investment.

The Ministry of Electronics and Information Technology (MeitY) administers the DLI scheme to foster a self-reliant chip design ecosystem, targeting startups, MSMEs, and domestic firms. Launched in December 2021, it spans the full semiconductor design lifecycle, encompassing integrated circuits, chipsets, systems-on-chips, and IP cores.

This initiative addresses India's semiconductor ambitions amid surging global demand driven by digitalisation in healthcare, transport, defence, space, and communications. Semiconductor manufacturing's concentration in few regions exposes supply chains to disruptions, prompting India to diversify as a reliable global player through the India Semiconductor Mission (ISM).

Fabless design holds pivotal value in the electronics chain, contributing over half the semiconductor's worth via intelligence, efficiency, and security, far beyond mere fabrication. The DLI scheme bolsters this by reimbursing up to 50% of eligible product design costs, capped at ₹15 crore per application, alongside deployment incentives of 4-6% of net sales for five years.

Eligible start-ups and MSMEs gain design infrastructure support, while other firms access deployment incentives, reducing import reliance and enhancing supply chain resilience. C-DAC serves as the nodal agency, establishing the ChipIN Centre—a shared platform granting access to advanced EDA tools for around 100,000 engineers and students across 400 organisations.

The Chips to Start-up (C2S) program aids 305 academic institutions, while 95 start-ups utilise India's EDA Grid, logging over 5.4 million hours of usage by early 2026. These measures have spurred over 140 reusable semiconductor IP cores, vital for advanced chip development.

Twenty-four approved projects target strategic sectors like video surveillance, drone detection, energy metering, microprocessors, satellite communications, and IoT SoCs. Beneficiaries exemplify progress: firms have transitioned from concepts to silicon-proven products, with standout successes in market-ready innovations.

The broader Semicon India Programme, with a ₹76,000 crore outlay, underpins investments in design, fabrication, and manufacturing via ISM, an autonomous division under Digital India Corporation. Complementary efforts include open-source microprocessors like VEGA, SHAKTI, and AJIT from C-DAC, IIT Madras, and IIT-Bombay.

DLI-supported achievements signal a shift to productization, enabling volume manufacturing, system integration, and market entry for start-ups and MSMEs. This fortifies India's talent pool and positions the nation in the high-value global chip design segment.

By mitigating geopolitical vulnerabilities and assured access to defence, telecom, and AI technologies, the scheme drives strategic autonomy and economic expansion. Ongoing momentum underscores India's emergence as a competitive force in semiconductors.

Based On Agency Reports