Centre clears 24 chip design projects to supercharge India’s semiconductor ecosystem
By Cygnus | 05 Jan 2026
In a significant move to solidify India’s position in the global semiconductor value chain, the Ministry of Electronics and Information Technology (MeitY) officially sanctioned project approvals for 24 homegrown chip design firms on Monday.
The approvals are part of the ₹76,000 crore Design Linked Incentive (DLI) scheme, which aims to transition India from a consumer of semiconductors to a global hub for intellectual property (IP) creation. Alongside the project sanctions, the government has granted 95 companies access to industry-grade Electronic Design Automation (EDA) tools, a move expected to slash R&D costs for early-stage startups by nearly 60%.
Focused on the ‘Missing Middle’
The 24 approved projects target critical high-growth sectors, including video surveillance, drone detection, smart energy meters, satellite communications, and Internet of Things (IoT) systems on chip.
By focusing on the “fabless” segment—which accounts for nearly 50% of the total value in the semiconductor supply chain—the government aims to nurture domestic IP that can eventually be manufactured at upcoming local foundries like the Tata-PSMC plant in Dholera.
“The DLI scheme is moving from the design board to reality,” a senior MeitY official stated. To date, the program has engaged over 1,000 engineers, led to 10 new patent filings, and successfully completed 16 ‘tape-outs’ (the final stage of the design process before manufacturing), with 6 ASIC chips already successfully fabricated.
Strategic scaling
The scheme has already leveraged over three times the amount of private investment initially projected. As the domestic electronics market is expected to hit $500 billion by 2030, these homegrown chips will provide a secure, localized supply chain for India’s strategic and commercial infrastructure.
Summary
The Indian government has cleared 24 new chip design projects under the ₹76,000 crore DLI scheme to boost domestic semiconductor IP. By providing financial support and access to elite design tools for 95 companies, MeitY is targeting high-value sectors like satellite comms and IoT. The initiative has already resulted in 16 successful chip tape-outs and 10 patents, marking a major step toward a self-reliant electronics ecosystem.
Frequently Asked Questions (FAQs)
- What is the DLI Scheme? The Design Linked Incentive (DLI) scheme offers financial and infrastructure support to domestic companies and startups involved in semiconductor design. It covers up to 50% of eligible expenditure, capped at ₹15 crore per application.
- Why is ‘Chip Design’ important? Design is the highest value-adding segment in the semiconductor chain. While manufacturing is capital-intensive, owning the design (IP) allows companies to control the technology and earn higher margins without needing to build billion-dollar factories.
- Which sectors will these chips serve? The newly approved projects focus on Drones, Satellite Communications, IoT, and Smart Metering—areas where India currently relies heavily on imported silicon.
- What is an ‘EDA’ tool? Electronic Design Automation (EDA) tools are sophisticated software suites used to design and test complex integrated circuits (ICs) before they are sent to a foundry. Access to these tools is provided through the ChipIN Centre at C-DAC.
