My Take on budget     

Published: February 15, 2026
Updated: February 15, 2026

FM bats for India’s tech boom

The Union Budget 2026-27, presented by Finance Minister Nirmala Sitharaman, has marked a decisive moment for India’s technology ambitions with the announcement of India Semiconductor Mission 2.0. The new phase signals a clear policy push to deepen domestic semiconductor capabilities at a time when chips underpin every crucial and industrial system. India Semiconductor Mission 2.0 will focus on producing semiconductor equipment and materials in India, designing full-stack Indian semiconductor intellectual property, and fortifying both domestic and global supply chains.

The budget introduces several measures to advance India’s semiconductor and electronics manufacturing sectors. The transition to India Semiconductor Mission (ISM) 2.0, backed by an outlay of Rs 40,000 crore, expands the mission’s scope beyond fabrication to include the domestic production of manufacturing equipment and essential materials such as chemicals, gases and wafers.

For RRP Electronics, the shift toward developing full-stack Indian IP is a significant policy development. This move positions the industry to move from assembly and testing into chip-level design and intellectual property ownership. The establishment of industry-led research and training centres will further support this by addressing the specific technical requirements for both design and manufacturing workforces.

Additionally, the decision to increase the outlay for the Electronics Components Manufacturing Scheme to Rs 40,000 crore — up from the initial Rs 22,919 crore — responds to the current investment momentum. This support for the production of PCBs, modules and sub-assemblies is essential for building a local supply chain that feeds into the semiconductor sector.

Finally, the focus on capital goods, including the set-up of high-tech tool rooms at two locations, and a new scheme for construction and infrastructure equipment will provide the precision tooling and machinery required for advanced electronics assembly. These initiatives collectively strengthen supply-chain resilience and reduce the industry’s dependence on foreign suppliers for critical upstream components.

DEFENCE OUTLAY

The Budget also demonstrates a sustained commitment to strengthening national security and industrial selfreliance. The allocation of Rs 2,19,306.47 crore for Capital Outlay on Defence Services provides the necessary financial foundation for the systematic modernisation of our armed forces. By maintaining a framework where a significant majority of capital procurement is reserved for the domestic industry, the government is fostering a predictable environment for long-term industrial growth. For manufacturers, this substantial capital expenditure enables the scaling of advanced technological research and the expansion of indigenous production lines, which is essential for reducing external dependencies and building a resilient, self-reliant defence supply chain.

(Rajendra Chodankar, a first-gen entrepreneur, is the architect of the RRP group and Chairman as well as Managing Director of RRP Electronics,RRP Semiconductor, RRP Defense)