MeitY seeks applications from domestic firms, start-ups and MSMEs under DLI scheme

A month after the government announced Rs 76,000 crore scheme for developing the semiconductor ecosystem in India, the Ministry of Electronics and Information Technology MeitY is now seeking applications from 100 domestic companies, start-ups and MSMEs under its Design Linked Incentive DLI scheme.

Financial incentives and design infrastructure support for domestic companies, start-ups and MSMEs will be extended over the DLI Scheme over various stages of development and deployment of semiconductor design for Integrated Circuits ICs chipsets, System on Chips SoCs systems and IP cores and semiconductor linked design over a period of five years.

The ministry has created a dedicated portal - www.chips dli.gov. Online applications are invited from January 1, 2022 to December 31, 2024.

There are three components of the scheme - chip design infrastructure support, product design linked incentive and deployment linked incentive. The Centre for Development of Advanced Computing C-DAC, a scientific society under MeitY, will serve as the nodal agency for the implementation of the DLI scheme.

Under the chip design infrastructure support, C-DAC will set up 'India Chip Centre' to host the state-of-the-art design infrastructure viz. EDA Tools, IP Cores and support for MPW Multi Project Wafer fabrication and post-silicon validation are some of the things that are accessible to supported companies. A 50 per cent reimbursement of eligible expenditure, subject to a ceiling of 15 crore per application, will be provided as fiscal support for those who are engaged in semiconductor design.

An incentive of 6 per cent to 4 per cent of net sales turnover over five years, subject to a ceiling of Rs 30 crore per application, will be provided to applicants whose semiconductor design is for ICs, chipsets, SoCs, systems, and IP cores, and semiconductor linked design are deployed in electronic products.

More than 50 per cent of the capital is beneficially owned by resident Indian citizens and Indian companies, which are ultimately owned and controlled by resident Indian citizens for a period of three years after claiming incentives under the scheme.

The threshold and ceiling limits must be met to be eligible for disbursement of incentives under the scheme.

The DLI scheme will take a graded and pre-emptive approach to identify the products of national priorities and implement strategies for their complete or near complete indigenisation and deployment, thereby taking steps towards import substitution and value addition in strategic and societal sectors.

The DLI scheme is part of the Rs 76,000 crore $10 billion package through which the government wants to bring up at least 20 domestic companies involved in semiconductor design and enable them to achieve a turnover of more than 1,500 crore over the next five years.