New Delhi: The Union Budget 2026–27 has laid the groundwork for the next phase of the India Semiconductor Mission (ISM 2.0), with a clear focus on building a strong domestic chip ecosystem and nurturing globally competitive Indian companies, Union Minister for Electronics and Information Technology Ashwini Vaishnaw said on 1 February.
Speaking to the media, Vaishnaw said ISM 2.0 aims to significantly strengthen India’s semiconductor design ecosystem, with a target of enabling around 50 major design startups. He noted that one or two of these firms are expected to scale into global leaders comparable to companies such as AMD, Intel and Qualcomm.
The minister also highlighted the enhanced outlay of Rs 40,000 crore for the Electronics Component Manufacturing Scheme (ECMS), which will prioritise the domestic manufacturing of machinery used in electronic component production.
He added that the government has identified six core systems that can serve as building blocks for designing future electronic systems across sectors, including defence, transportation, electric vehicles and consumer electronics.
On data centres, Vaishnaw said innovations are helping address concerns over land, water and energy use, citing startups working on energy-efficient solutions and emerging technologies such as compact nuclear power generators.
He also welcomed the expansion of the “safe harbour” tax benefit and described Budget 2026-27 as historic, saying its focus on manufacturing and infrastructure would drive investment and deliver a strong multiplier effect.
