Key Takeaways from India’s Design Linked Incentive (DLI) Scheme for Fabless Semiconductor Companies
- fabless369
- Jan 6
- 2 min read
The Government of India has introduced the Design Linked Incentive (DLI) Scheme under the Semicon India Programme to accelerate the growth of India’s semiconductor design ecosystem. The scheme recognises chip design as the most strategic and value-intensive segment of the global semiconductor value chain, contributing up to 50% of value addition, 20–50% of BOM cost, and 30–35% of global semiconductor sales, largely driven by the fabless model
Implemented by the Ministry of Electronics and Information Technology, the DLI Scheme aims to build a self-reliant and globally competitive chip design ecosystem by supporting domestic startups and MSMEs engaged in semiconductor design and deployment
What This Means for Fabless Semiconductor Companies
For fabless semiconductor companies, the DLI Scheme directly addresses the key challenges of high design costs, limited access to advanced tools, and long commercialization cycles. The scheme offers financial incentives, including reimbursement of up to 50% of eligible design expenditure and deployment-linked incentives on net sales, significantly reducing early-stage financial risk.
Beyond financial support, fabless companies gain access to shared national design infrastructure through the ChipIN Centre, including advanced EDA tools, IP core repositories, MPW prototyping, and post-silicon validation support. This enables startups and MSMEs to undertake complex chip design without heavy upfront capital investment.
The scheme is already translating into tangible outcomes for the fabless ecosystem. 24 DLI-supported chip design projects are targeting strategic sectors such as video surveillance, drone detection, energy metering, microprocessors, satellite communications, and IoT SoCs. To date, supported companies have achieved 16 tape-outs, six fabricated ASIC chips, 10 patents, and development of 140+ reusable IP cores, with over 1,000 specialised engineers engaged .
As the ecosystem matures, the DLI Scheme is enabling fabless companies to move beyond design validation toward productization, system integration, and market deployment, positioning Indian fabless firms as credible global players while strengthening India’s semiconductor self-reliance
Comments