Eyeing to boost India’s position in the global semiconductor industry, this time, Union Budget increased MeitY’s funding by 52% to ₹219.36 billion due to a huge rise in capital allocation for the Modified Programme.
The budget allocation for the Ministry of Electronics and Information Technology (MeitY) in 2024-25 has surged by 52% to reach ₹219.369 billion, up from ₹144.2125 billion in the revised estimate for 2023-24.
This increase in MeitY’s budget is largely due to a 355% rise in capital allocation for the Modified Programme, which aims to develop India’s semiconductor and display manufacturing ecosystem.
The programme’s capital allocation reached ₹69.03 billion from ₹15.0336 billion in the previous year’s revised estimates.
The most significant portion of ₹42.03 billion has been allocated to the “Modified Scheme for establishing semiconductor and assembly facilities in India.”
Furthermore, incentive schemes for semiconductors, large-scale electronics manufacturing, and IT hardware will benefit major companies such as Micron and Tata Electronics to establish facilities in India, as reported by the Economic Times.
The finance minister, Nirmala Sitharaman, presented the union budget for 2024-25 in the lower house of the parliament on Tuesday morning.
According to industry experts like Munira Loliwala from TeamLease Digital, this increased funding will bolster the establishment of advanced manufacturing facilities and reduce dependence on imports, aspects which Sitharaman had focused on this time in the budget session.
Experts also expect more significant global investments, which will generate high-tech jobs and position India as a key player in the global semiconductor supply chain, ultimately boosting the country’s technological self-reliance and competitiveness.
Additionally, the government has allocated ₹5.5175 billion for the IndiaAI mission to strengthen the country’s Artificial Intelligence infrastructure. Previously, the NDA cabinet approved over ₹103 billion for the mission in March, intended to be disbursed over the next five years.
This funding aims to accelerate key aspects of the IndiaAI Mission, focusing on compute capacity, innovation center, datasets platform, application development, startup financing, and initiatives for safe and trusted AI. Central to this effort is the IndiaAI compute capacity, aiming to establish a cutting-edge AI computing infrastructure with over 10,000 GPUs through strategic public-private partnerships.
However, for the second year running, no funds have been allocated for the rural digital literacy scheme Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA) or PLI schemes in large-scale electronics or IT hardware. Additionally, no funds were earmarked this year for promoting digital payments, following an allocation of ₹15 billion last year and a revised estimate of ₹5.84 billion for 2023-24.
