Design Linked Incentive (DLI) Scheme

In Context

• The government will review norms of the Design Linked Incentive (DLI) program which envisages to support 100 companies involved in product design in the semiconductor space as part of a Rs 76,000 crore scheme for developing the electronic chip ecosystem in the country, 

About Design Linked Incentive (DLI) Scheme.

• It was announced in December 2021 by MeitY.
• It aims to provide financial and infrastructural support to companies setting up fabs or semiconductor making plants in India.
• Aims: To create a vibrant ecosystem for Semiconductor Chip Design in the country.

• To promote the domestic manufacturing of semiconductors and allied devices. 
• The scheme is expected to provide a globally competitive incentive package to companies in semiconductors and display manufacturing as well as design.

• Components: It has three components which are: 
  • Chip Design infrastructure support:
    • Under it, C-DAC will set up the 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) & post-silicon validation) and facilitate its access to supported companies.

• The Product Design Linked Incentive: 
  • Under it, reimbursement of up to 50% of the eligible expenditure subject to a ceiling of ?15 Crore per application will be provided as fiscal support to the approved applicants who are engaged in semiconductor design.
• The Deployment Linked Incentive: 
  • Under it, an incentive of 6% to 4% of net sales turnover over 5 years subject to a ceiling of ?30 Crore per application will be provided to approved applicants whose semiconductor design for Integrated Circuits (ICs), Chipsets, System on Chips (SoCs), Systems & IP Cores and semiconductor linked design are deployed in electronic products.

Source: ET