Budget 2023: Bolstering India’s emerging semiconductor ecosystem

With a 40% increase in allocation compared to last year, the Budget 2023-2024, presented by finance minister Nirmala Sitharam, has allotted a total of Rs. 16,549 crore for the Ministry of Electronics and Information Technology, reflecting cognisance of the accelerated demand for electronics in the post-pandemic era.


The growth of semiconductor manufacturers in India has prompted the government to support the developing ecosystem with the potential to become a top supplier to developing nations. The government will allocate Rs. 3,000 crore to the Indian Semiconductor Mission, aimed at fostering the development of the semiconductor and display manufacturing industries. This will aid in the design and production of various high-quality electronics, such as laptops, servers, tablets, PCs, and more.

The semiconductor manufacturing industry experts noted several observations regarding this year's budget announcement:

Niranjan Nayak, MD, Delta Electronics India

We are firmly aligned with the government’s vision of ‘Amrit Kaal’ which includes a technology-driven, knowledge-based sustainable economy. For the vision of 2070 Net-Zero CO2 emission, investment in the energy transition will play a crucial role. We at Delta have already implemented many programs for reducing carbon emissions and signed up for many sustainable initiatives like RE100, net zero, green products etc. for a greener tomorrow. Also, all our products offerings are energy-efficient and green solutions that aid in achieving the overall nation’s carbon footprint reduction targets ranging from power quality improvement products to green EV charging solutions etc.

The Budget 2023 further focus on sectors that include setting up labs for developing applications using 5G services, railways and enhanced focus on the smart city infrastructure to keep the economy on a steady growth, these are progressive measures and we feel that they will play a critical role for us to become key contributors in these areas and further development.

Krishna Moorthy. K CEO & President of IESA, Indian Electronic and Semiconductor Association
Over the last few years, the industry has seen the consistency in budget thought flows from the government and this has led to some amount of stability and increased credibility to the governments approach to industry related policy support. The 2023 budget is no exception as India steers the G-20 in the current disposition. The support for the core industries remain intact, deep tech industries get the much-needed boost and electronics and semiconductor in particular is given the impetus to make it contribute about 8-10% to GDP before the end of this decade. Specifically, the budget focuses on MSMEs and it will enable India to become one of the leading manufacturer in ESDM sector and meet the industry expectations of enhanced global exports. India is indeed a benchmark in digital prowess for the world.

Anurag Awasthi, Vice President IESA, Indian Electronics and Semiconductors Association
The Union Budget is balanced and will be another stepping stone in achieving the landmark of $ 1 Trillion digital economy. The provisions, as stated in the budget will spurn manufacturing,design as well as skill development besides providing pivotal impetus to MSME sector.The budget heralds that the impact of technology and its contribution in the socio- economic as well as evolutionary aspects of the nation is clearly benchmarked. This budget is special as it is formulated post two years of a pandemic, an ongoing raging conflict in the west, an anticipated global recession and India’s rise as a global power in the comity of nations. This is India’s techade with astute government policies with a supportive budgetary envelope."

Himanshu Singh Raghuvanshi, Co-Founder & COO, CapGrid
The budget is very thoughtful driven by market dynamics. Lots of positives coming out on the green energy front. Welcome the decision of extension of subsidies on EV batteries. Scheme to support state governments and municipalities in replacing their old polluting vehicles will also give sales push to the automotive & EV segment. With cost of capital expected to remain high, glad that the current liquidity scenario in the markets have been paid heed to with Credit Guarantee Scheme for MSMEs extended with an infusion of Rs 9000 crore. This will help the entire auto sector which is held together by MSMEs.

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