Five of the 12 semiconductor manufacturing projects India has approved have started commercial production, the head of the country's chip program said Thursday, as New Delhi shifts the second phase of its subsidy drive toward the suppliers that keep factories running.

Amitesh Kumar Sinha, an additional secretary at the Ministry of Electronics and Information Technology and chief executive of the India Semiconductor Mission (ISM), said the strategy had moved from writing policy to building an industry, according to IANS. He spoke on the final day of the ISIG Executive Summit India 2026 in New Delhi, the first edition of that industry meeting held in the country.

For investors across Asia, the figure gives a rare progress check on one of the region's largest state chip programs. The gap between approvals and actual output has been the main question hanging over India's plans. Five plants producing is still a small base. It is also more than the program could show a few months ago.

From India Semiconductor Mission 1.0 to Semicon 2.0

The first phase of the mission carried an allocation of Rs 76,000 crore. By July it had backed 12 projects with cumulative investment of about Rs 1.64 lakh crore, most of it from Tata Electronics and its semiconductor unit, according to PTI.

On July 15 the Union Cabinet approved the follow-on program, Semicon 2.0, with an outlay of Rs 1.27 lakh crore, IT Minister Ashwini Vaishnaw said at the time. He said the government expects the scheme to draw about Rs 4 lakh crore of investment and to produce semiconductors worth Rs 2 lakh crore over the scheme period. Vaishnaw said India would be self-reliant in producing indigenous chips by the end of the program, PTI reported.

The finance ministry's Expenditure Finance Committee had cleared the plan two weeks earlier. IANS reported then that the second phase aims to meet up to 75% of domestic chip demand by 2030, and that it widens support to industrial gases, specialty chemicals, capital equipment and smaller ancillary suppliers. At that point a pilot production line had started at a unit in Sanand, Gujarat, with four more units expected to begin output within a year.

The jump from one pilot line in late June to five projects in commercial production by early November suggests the first-phase plants are arriving roughly on that schedule. The government has not published a plant-by-plant breakdown with Sinha's latest figure.

Suppliers, design and power chips

Sinha described the new phase as broader than factory subsidies. "Semicon 2.0 is about building the broader ecosystem," he said, listing design companies, materials, chemicals, gases, equipment, manufacturing, research and talent, according to IANS. He named India's domestic market, its engineering workforce and state incentives as its main advantages, and said global technology partnerships and reliable supply chains would be essential.

That emphasis matters for foreign suppliers. Equipment makers Applied Materials and Lam Research and materials groups Merck and Linde are among the companies investing in supporting factories and supply chains in India, IANS reported in June. A larger pool of incentives for gases, chemicals and tools gives those companies, and their Asian competitors in Japan, South Korea and Taiwan, more reason to build locally rather than ship from established hubs.

The summit's agenda pointed to where India hopes to win business first. Sessions covered advanced packaging, outsourced assembly and test, power electronics, and wide-bandgap materials such as silicon carbide and gallium nitride, which are used in electric vehicles, chargers and data-center power systems. Shalu Agarwal, general manager for India and head of power semiconductors at ISIG, said India's opportunity in advanced packaging and power electronics "is real," IANS reported.

States are also competing for projects. ISIG signed a cooperation agreement with the government of Bihar on developing that state's semiconductor and electronics industry. Madhya Pradesh held its own semiconductor investment summit, where it collected Rs 15,425 crore in proposals.

What to watch

The test for Semicon 2.0 is whether the remaining seven first-phase projects reach commercial output and whether the larger outlay pulls in the suppliers that India still imports from abroad. The government has said little about how quickly the Rs 1.27 lakh crore will be disbursed, or which companies will receive the first awards under the new phase.

ISIG has scheduled its next India summit for Nov. 30 to Dec. 1, 2027.