India's cabinet approves $26 bn semiconductor mission and mobile phone manufacturing scheme

The Union Cabinet, chaired by Prime Minister Narendra Modi, approved a package of seven major decisions worth a total of Rs 2,19,353 crore (about $26 billion). The centerpiece is the Semicon 2.0 mission, allocated Rs 1,27,500 crore, aimed at building a complete domestic semiconductor ecosystem across design, fabrication, packaging, equipment, R&D and talent. The government expects the programme to attract roughly Rs 4 lakh crore of investment, generate chip production worth Rs 2 lakh crore and achieve exports of Rs 1 lakh crore.

The Cabinet also cleared the Mobile Phone Manufacturing Scheme (MPMS) with a Rs 62,500 crore outlay for a five‑year period (FY 2026‑27 to FY 2030‑31). The scheme offers incentives of 2.25‑5% on eligible sales, an additional 1.5% for domestic component sourcing and a further 3% for design and R&D, targeting cumulative production of about Rs 39 lakh crore, a boost in handset exports and the creation of roughly 60,000 direct jobs.

Infrastructure projects in Varanasi were approved as well, including two elevated corridors along the Varuna and Ganga rivers costing Rs 10,998 crore and Rs 14,448 crore respectively (total Rs 25,446 crore), intended to de‑congest the city and improve pilgrim connectivity. The overall package signals a major push to strengthen India’s manufacturing base, technology self‑reliance and regional infrastructure.