Introduction
Union Minister for Electronics and Information Technology Ashwini Vaishnaw has consistently framed India’s semiconductor push as more than a manufacturing initiative alone, positioning it explicitly as an ecosystem play that includes nurturing a domestic chip design and semiconductor startup community alongside large-scale fabrication investment. This article looks at how this “chips to startups” strategy has unfolded and what it means for India’s emerging semiconductor entrepreneurship ecosystem.
The Foundation: India Semiconductor Mission 1.0
Launched in December 2021 with an incentive outlay of ₹76,000 crore, India Semiconductor Mission 1.0 focused primarily on establishing the country’s first semiconductor assembly, testing, marking, and packaging (ATMP) facilities and building foundational ecosystem infrastructure. As of December 2025, ten projects representing a total investment of ₹1.60 lakh crore had been approved across six Indian states, with commercial production beginning at facilities including those operated by Micron and Kaynes.
The Startup Dimension: Design Linked Incentive Scheme
Alongside large-scale manufacturing investment, the government has specifically supported chip design startups through the Design Linked Incentive (DLI) scheme, which provides financial and infrastructure support to startups engaged in semiconductor chip innovation and design. Vaishnaw has specifically highlighted examples of this scheme in action, including startups developing secure IoT chipsets with backing from both the DLI scheme and academic expertise from institutions like IIT Madras.
Building the Talent Pipeline
A significant part of the semiconductor mission’s ecosystem strategy has centered on talent development, with Vaishnaw noting that 315 universities now provide students access to important Electronic Design Automation (EDA) tools from major providers including Synopsys, Cadence, and Siemens, allowing students at institutions across the country, including remote colleges, to design chips and see them through to actual tape-out and validation. This talent pipeline is explicitly framed as feeding both large semiconductor companies and the broader startup ecosystem.
Semicon 2.0 and the Focus on Design
The next phase of India’s semiconductor strategy, Semicon 2.0, has been explicitly framed by Vaishnaw as prioritizing chip design as the “topmost priority,” followed by semiconductor manufacturing equipment and materials, and continued talent development. This design-first emphasis in the next phase reflects a deliberate strategy to build India’s position not just as a manufacturing location, but as a genuine center for the more intellectually- and startup-friendly design side of the semiconductor value chain.
The 2-Nanometer Milestone
In a notable 2026 milestone, Vaishnaw joined Qualcomm in Bengaluru for the launch of a 2-nanometer semiconductor chip design, a significant marker of advanced design capability within India, with Vaishnaw stating that India Semiconductor Mission 2.0 will work toward the country building its own 2-nanometer chips domestically, alongside a stated ambition of India becoming among the top four semiconductor manufacturing nations globally by 2035.
Learning From Past Attempts
Vaishnaw has been notably candid about India’s semiconductor policy history, directly addressing questions about a previously failed 2005 AMD-backed semiconductor project, stating the government had “learnt from past attempts” in designing the current, more structured approach with 12 semiconductor units and $20 billion in approved investment as of recent statements, framed as reflecting clearer policy design and execution compared to earlier, less successful efforts.
Government as Startup Ecosystem Builder
Vaishnaw’s approach reflects a broader pattern of the Indian government positioning itself not just as a regulator or manufacturing incentive provider, but as an active builder of the surrounding innovation ecosystem, talent pipelines, design tool access, and startup-specific incentive schemes, that a genuinely competitive semiconductor sector requires beyond fabrication capacity alone.
What This Means for Aspiring Chip Design Founders
For entrepreneurs interested in semiconductor design startups specifically, the DLI scheme and broader India Semiconductor Mission ecosystem represent a genuine, government-backed pathway worth researching directly through official Ministry of Electronics and Information Technology channels, particularly given the explicit ministerial emphasis on design-focused startups as a priority area within the broader semiconductor mission’s next phase.
Conclusion
Ashwini Vaishnaw’s framing of India’s semiconductor strategy as a “chips to startups” ecosystem play, combining large-scale manufacturing investment with specific talent development and design-focused startup incentive schemes like DLI, reflects a deliberate government strategy to build genuine entrepreneurial capacity within the semiconductor sector, not just manufacturing capacity alone. As Semicon 2.0 unfolds with its explicit design-first priority, this startup dimension appears likely to remain a consistent, emphasized part of India’s broader semiconductor policy narrative.