The Finance Ministry cleared Rs 1.25 lakh crore for ISM 2.0 last week. Vaishnaw laid foundation stones for India’s first domestic multi-layer PCB plants in Jewar on 27 June. IIT Bombay students built a working chip fab for Rs 30 lakh and published every process detail.
Assam signed two more semiconductor MOUs. India’s trade deal with the United Kingdom goes live on 15 July.
Five stories from a fortnight when every layer of India’s chip ecosystem moved. Issue #4 covered the NITI Aayog’s 10-year roadmap. This issue covers what moved in the weeks after.
Story 1: ISM 2.0 Clears Finance Ministry, Heads to Cabinet
The Finance Ministry’s Expenditure Finance Committee cleared a Rs 1.25 lakh crore outlay for ISM 2.0 last week. The proposal now goes to the Union Cabinet for final approval. The outlay is 64 per cent larger than the Rs 76,000 crore committed under ISM 1.0.
The scope shift matters as much as the scale. ISM 1.0 targeted anchor plants: fabs, OSAT facilities, and early-stage chip design startups. ISM 2.0 adds the categories that make those anchors functional:
- Industrial gases and specialty chemicals
- Capital equipment for semiconductor manufacturing
- MSMEs and ancillary suppliers
The stated target is 75 per cent of India’s domestic semiconductor demand met through local production by 2030.
Gear Shift has tracked ISM 2.0 from Issue #1 to Issue #4. The EFC clearance converts that thread into a funded programme awaiting one final Cabinet stamp.
The MSME angle: The scheme text naming MSMEs and ancillary suppliers is new language. Northeast firms should read the Cabinet notification when it drops and identify which product categories fall within scope. The first application windows will define the opportunity.
Story 2: Assam Signs Two More Semiconductor MOUs
On 24 June, Chief Minister Himanta Biswa Sarma announced that Assam had signed agreements with two additional semiconductor companies for setting up units in the state. The company names were not disclosed.
The announcement arrived the same day Finance Minister Jayanta Mallabaruah told a pre-Budget consultation in Guwahati that the state had attracted over Rs 5 lakh crore in investment proposals over the decade. Mallabaruah added that TSAT Jagiroad is expected to begin exporting chips before the end of 2026.
The timing is deliberate. TSAT has not yet commissioned. Two more semiconductor firms signing MOUs before the first plant ships a single chip signals that the anchor effect is working ahead of production.
The MSME angle: Three potential vendor qualification windows now exist in Assam. Northeast MSMEs should not wait for all three to announce timelines before beginning ARI readiness assessments. The lead time from assessment to qualification runs long enough that preparation starts now.
Story 3: Vaishnaw Lays Foundation for India’s First Domestic PCB Plants
On 27 June, Vaishnaw and Uttar Pradesh Chief Minister Yogi Adityanath jointly laid foundation stones for two electronics manufacturing projects worth Rs 6,750 crore at Yamuna City, Jewar:
- Ascent-K Circuits, a joint venture with South Korea’s KCC, producing high-density multi-layer PCBs
- Amber Enterprises, investing Rs 3,500 crore in PCB assemblies and HVAC components
India currently imports PCBs worth Rs 40,000 crore annually. The Jewar plants are the first industrial-scale attempt to close that gap. These are 20-22 layer structures used across defence, automotive, and consumer electronics systems.
The MSME angle: Every electronics assembly operation uses PCBs. The national quality baseline for these components is shifting. Firms supplying government defence or telecom contracts should audit their current PCB sourcing and check IPC certification requirements before the domestic supply chain restructures around the new Jewar facilities.
Story 4: IIT Bombay Students Built a Working Chip Fab for Rs 30 Lakh
A group of undergraduates at IIT Bombay has built three semiconductor fabrication tools from scratch in ten months, for a total cost of Rs 30 lakh. The HackerFab IITB project produced:
- A DLP-based lithography machine achieving 1-micron feature sizes
- A tube furnace for silicon oxidation
- A DC plasma sputter for thin-film deposition
Working PN diodes and MOSCAPs have been fabricated. A complete NMOS transistor is the next step.
I first found out about HackerFab through this tweet:
The Swarajya long read on HackerFab identifies the problem the project exists to solve: undergraduate access to fabrication equipment at Indian universities is rationed. The institutional nanofab costs tens of crores to operate and runs on research priority.
HackerFab built cheap enough tools that students are allowed to break them. Every process step, design file, and bill of materials is open-sourced. Any college in India can replicate the setup from the published documentation.
And in another whitepill moment, after that tweet went viral, Ola’s Bhavish Aggarwal extended a standing job offer to the entire HackerFab team.
The MSME angle: Northeast engineering colleges now have a documented, costed template to build hands-on semiconductor fabrication training without waiting for central funding. Rs 30 lakh is within reach for most institutional budgets. Institutions that want to supply qualified talent to TSAT have a working starting point.
Story 5: India-UK FTA Goes Live 15 July, Assam Prepares
The India-UK Comprehensive Economic and Trade Agreement comes into force on 15 July 2026. On 24 June, Assam Chief Secretary Ravi Kota met British Deputy High Commissioner Andrew Fleming to develop a strategic roadmap covering investment, exports, technology integration, and infrastructure.
The agenda included a proposed Assam-UK Infrastructure Roundtable and the UK-India Sovereign AI Partnership.
The substantive specific from that meeting: the British delegation presented a UK PACT-supported Battery Energy Storage System assessment for Assam Power Distribution Company Limited. Grid reliability and renewable energy integration are the stated focus. Both are prerequisites for any semiconductor or electronics cluster operating at scale.
As Nitisagar’s East-NE Logistics Roadmap documents, Assam’s infrastructure gap remains the binding constraint on industrial ambition. The UK FTA creates a financing channel, through UK Export Finance, to address it directly.
The MSME angle: Zero-duty UK market access for Assam tea is the consumer goods headline. For manufacturing-sector readers, the BESS study and the AI partnership channel are the signals worth watching. MSME suppliers in renewable energy components and grid infrastructure should monitor UK FCDO project announcements over the next six months.
Gear Shift is a fortnightly roundup of India’s manufacturing and industrial policy developments, with a focus on implications for MSMEs in Northeast India. Published by Nitisagar Advisory, Guwahati.
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