Govt amends PLI scheme for semiconductor making, applications to need Cabinet nod

The PLI scheme for semiconductor manufacturing was launched in Dec 2021

The approval for setting up compound semiconductors and display fabs assembly and test units, under the Ministry of Electronics and IT (MeITY)'s production-linked incentive (PLI) scheme, will now be issued by the Union Cabinet, a government notification said on June 10.

Till now, the approval for applications involving a value of up to Rs 100 crore was issued by the MeITY Secretary, and those above Rs 100 crore were evaluated by the Union Minister for Electronics and IT.

The amendments moved via the latest MeITY notification has removed the above categorisation, and makes the Union Cabinet the sole authority to grant approval for applications under the PLI scheme.

"Applications shall be appraised and evaluated individually on an ongoing basis. The Ministry of Electronics and Information Technology will
place the applications for approval of the Union Cabinet," the notification stated.

The PLI scheme - 'Modified Programme for Semiconductors and Display Fab Ecosystem' - was announced in December 2021 with a total outlay of Rs 76,000 crore. It was tweaked in September last year to woo global investors with more attractive incentive support.

Earlier, the scheme offered incentives with varying degree of fiscal support, ranging from 30-50 percent. This was later made uniform, with the government offering to fund 50 percent of the project cost across all technology nodes for setting up of semiconductor fabs, including not just cutting-edge computing chips but also those used in power, telecom and automotive sectors.