The Design Linked Incentive (DLI) Scheme is an initiative by the Ministry of Electronics and Information Technology in India to provide financial incentives and design infrastructure support for the semiconductor industry.
The scheme aims to achieve significant indigenization in semiconductor and electronic products and IPs deployed, thereby facilitating import substitution and value addition in the electronics sector in the next 5 years.
Additionally, the scheme aims to strengthen the design infrastructure through incubators for semiconductor design and attract large investments for setting up semiconductor wafer fabrication facilities in the companies/consortia/joint ventures proposing to set up a Silicon CMOS-based Semiconductor Fab.
The government plays a crucial role in the Design Linked Incentive (DLI) Scheme for the semiconductor industry. The scheme is implemented by the Centre for Development of Advanced Computing (C-DAC), which operates under the Ministry of Electronics and Information Technology (MeitY) and serves as the nodal agency for the implementation of the DLI scheme.
This scheme is significant for the semiconductor industry for several reasons:
Financial Incentives: The scheme offers financial incentives to semiconductor manufacturers, which can help them invest in setting up semiconductor wafer fabrication facilities and promote the development of semiconductor design companies.
Design Infrastructure Support: The DLI Scheme provides design infrastructure support across various stages of development and deployment of semiconductor products, including chipsets, system-on-chips (SoCs), systems, IP cores, and semiconductor-linked designs.
Indigenization: The scheme aims to achieve significant indigenization in semiconductor and electronic products and IPs deployed, thereby facilitating import substitution and value addition in the electronics sector.
Strengthening Design Infrastructure: The DLI Scheme strengthens the design infrastructure through incubators for semiconductor design, which can help nurture domestic companies of semiconductor design for Integrated Circuits (ICs), Chipsets, Systems on Chips (SoCs), Systems and IP Cores, and semiconductor-linked design.
Attracting Investments: The scheme aims to attract large investments for setting up semiconductor wafer fabrication facilities in companies, consortia, or joint ventures proposing to set up a Silicon CMOS-based Semiconductor Fab.
Expansion: The government plans to expand the DLI scheme to include even foreign semiconductor companies, which can further stimulate the growth of the semiconductor industry in India.
Overall, the DLI Scheme is a significant initiative by the Ministry of Electronics and Information Technology in India to promote the development of the semiconductor industry and position India as a global hub for the electronics system design and manufacturing (ESDM) industry.
Since its announcement, the DLI scheme has approved only seven startups, markedly short of its target of supporting 100 over five years. This impact assessment, therefore, presents an opportunity for policymakers to appraise and revamp the scheme.
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