The Ministry of Electronics and Information (MeitY) is inviting applications from 100 domestic semiconductor chip design firms, companies, start-ups and Micro, Small and Medium Enterprises (MSMEs) under its Design Linked Incentive (DLI) Scheme. This scheme is a component of MeitY’s extensive program aimed at developing the semiconductor and display manufacturing ecosystems within the nation.
Semiconductors and Their Role in Electronics
Semiconductors are a class of crystalline solids with electrical conductivity between that of a conductor and insulator. Utilized in various electronic devices like diodes, transistors, integrated circuits etc., semiconductors have gained popularity due to their compactness, reliability, power efficiency, and low cost. They are also used in power devices, optical sensors, and light emitters, including solid-state lasers.
Key Features of DLI Scheme
Under the DLI scheme, financial incentives and design infrastructure support will be extended to domestic companies, startups and MSMEs across different stages of development and deployment of semiconductor design. Approvals depend on meeting the Threshold and Ceiling Limits, and a dedicated portal has been established for this purpose.
Aims and Approach of DLI Scheme
The scheme aims to nurture and facilitate at least 20 domestic companies involved in semiconductor design to achieve turnover of over Rs.1500 Crore within the next 5 years. It plans to identify products of national priorities and implement strategies for their complete or near complete indigenisation & deployment, thereby promoting import substitution and value addition.
Nodal Agency for Implementation
C-DAC (Centre for Development of Advanced Computing), a scientific society operating under MeitY, will serve as the nodal agency for implementing the DLI scheme.
Components of DLI Scheme
The scheme comprises three components – Chip Design infrastructure support, Product Design Linked Incentive and Deployment Linked Incentive. Under chip design infrastructure support, C-DAC will establish the India Chip Centre, facilitating access to state-of-the-art design infrastructure for supported companies.
While the product design linked incentive will offer a reimbursement of up to 50% of the eligible expenditure to approved applicants engaged in semiconductor design, the deployment linked incentive will provide an incentive of 4-6% of net sales turnover over 5 years to approved applicants whose designs are deployed in electronic products.
Government Initiatives for Semiconductor and Display Manufacturing
To boost semiconductor and display manufacturing, the government will extend fiscal support of up to 50% of the project cost for setting up fabrication units, modernize and commercialize the Semi-conductor Laboratory (SCL), provide 30% of capital expenditure to approved Compound Semiconductors units, and set up a specialized and independent India Semiconductor Mission (ISM).
Incentives worth Rs.55,392 crore (7.5 billion USD) have been approved under various schemes including Product Linked Incentive (PLI ) for Electronics Manufacturing, PLI for IT Hardware, SPECS Scheme and Modified Electronics Manufacturing Clusters (EMC 2.0) Scheme.
About C-DAC and Contribution to Indian Semiconductors
C-DAC is the premier Research & Development organization of MeitY. It specializes in R&D in IT, Electronics and associated areas. It is notable for indigenously building India’s first supercomputer PARAM 8000 in 1991.