Odisha Semiconductor and Fabless Policy-2023


Electronics and Semiconductors have emerged as critical elements of economic growth and strategic security for any country. While India steadfastly marches towards the USD 5 Trillion economy aptly supported by USD 1 Trillion Digital economy, it is imperative that India develops a self-reliant and sustainable electronics and semiconductor ecosystem within the country.

In recent years, the ICT and Electronics sector has experienced significant growth, largely driven by escalating demand from emerging market economies. A noteworthy shift in manufacturing locales has also been observed, with a move away from Europe and North America towards Asia. Presently, China is the predominant global destination for ESDM, with its electronics production accounting for nearly 40% of global output and 30% of global electronics exports. Furthermore, Southeast Asia, particularly Vietnam, and Indonesia, has emerged as a prominent global hub for electronics manufacturing. This is attributed to a combination of factors, including lower labor costs, and attractive incentives.

The global electronics market is currently valued at around USD 2 trillion and is expected to grow significantly due to the increasing penetration of emerging technologies such as 5G, IoT, Artificial Intelligence, Robotics, Smart Mobility, and Smart Manufacturing.

Odisha being a prominent industrial state, is embarking upon its journey to attract Semiconductor value chain investments in the state.


  • The Odisha Semiconductor Manufacturing and Fabless Policy envisions developing an end-to-end semiconductor ecosystem in Odisha. The policy aspires to contribute to the national semiconductor ecosystem development objectives and aims to transform Odisha into a leading center of semiconductor design and manufacturing, a startup hub for semiconductor R&D and design companies, and the primary repository of the semiconductor design talent in the country.


  • To create a semiconductor design and manufacturing ecosystem in Odisha that can contribute to the state’s economic growth, its culture of innovation, create jobs for the people, and help India increase its self-reliance in an area of strategic importance.
  • To create state-of-the-art infrastructure with cutting-edge design and testing tools that can enable startups, companies, and academic institutions to collaborate and fulfill their true potential.
  • To build a conducive fabless ecosystem in the state and attract a minimum of 100-120 chip design companies and startups in the next 7 years.
  • To create a minimum of 5000-6000 high-end jobs in the chip design space in the next 7 years.
  • To create a pipeline of industry-ready talent pool by fostering linkages between industry and academia, by regularly updating the electronics curriculum taught in universities and technical institutions, and by enabling industry and academic institutions to undertake skill-building workshops.
  • To empower the semiconductor ecosystem, deliver at least two full-fledged chip designs every year catering to the national and international markets.
  • To create an environment in the medium to long term that is developed and conducive for the eventual establishment of fabrication units in the state and promotes higher value addition in semiconductor design and manufacturing.

Ease of doing business

  • Single window clearance system with a clear timeline for project approvals and guidance
  • Online system for submission of application forms for various clearances and tracking of the application
  • An “Apex Committee”, led by the Chief Secretary, will oversee the implementation of the Odisha Semiconductor and Fabless Policy. This committee will monitor policy implementation, project progress, grievance redressal, and approval of incentives on a quarterly basis.
  • A “Policy Advisory Group” will be formed for the Semiconductor and Electronics sector, comprising of industry experts and senior representatives from various departments. This group will provide advice and direction to the Semiconductor and Electronics sector in the state.
  • The Odisha Computer Applications Centre (OCAC) will be the Nodal Agency responsible for the implementation and monitoring of various activities under this Policy on behalf of the Electronics & Information Technology Department.
  • The Electronics & Information Technology Department will periodically review the implementation of the policy for facilitation and mid-course correction where necessary.
  • The IT and Electronics Promotion Cell at OCAC will act as the Project Implementation Unit (PIU) and Project Management Unit (PMU) for the Odisha Semiconductor and Fabless policy.
  • Operational guidelines and statutory notifications issued by the Electronics & Information Technology Department/OCAC will govern the implementation of provisions covering incentives, concessions, and competent authority. OCAC will administer the disbursement of incentives, ensuring that they do not exceed the capital investment made by entrepreneurs/companies.
  • Incentive disbursement by the implementing agency will follow a chronological order of approved claims, and the date of commercial production for availing incentives will be determined by a competent authority notified in operational guidelines.
  • A unit will become ineligible for incentives if it fails to file a complete claim within one year of starting production or within the time limit prescribed in the operational guidelines of this Policy. Condonation of delay for time overrun in implementation of projects may be considered by the Empowered Committee (EC) on a case-by-case basis. The EC will be chaired by the Secretary, E&IT Department, and will include the Secretaries of the Finance Department, Industries Department, and MSME Department.
  • The State Government reserves the right to amend any provision of the policy at any time.

Policy incentives

S.N Incentive Details
1 Land

At a concessional industrial rate as per IPR 2022

  • First 5 projects with investment above INR 5000 Crore, additional 25% discount over the prevailing IPR rate
  • For each mega project subsequent to the first five, 10% subsidy for the first 200 acres over the prevailing IPR rate will be considered
  • For each non-mega project investment, 5% subsidy for the first 50 acres over the prevailing IPR rate will be considered
2 Stamp Duty 100% stamp duty exemption
3 Capital Investment Subsidy

Additional 25% Capex contribution towards the overall project Capex (The Govt of India provides for 50% of the Capex) offered on a ‘pari-pasu’ basis. Applicable to projects approved under the India Semiconductor Mission (ISM).


30% of the overall project capex for companies offered on a pari-pasu basis applicable for firms not going through the ISM route

4 Electricity Duty & Electrical Inspection Exemption 100% exemption from payment of Electricity Duty & Electrical Inspection for a period of 10 years from the date of commencement of commercial production
5 Power Tariff Reimbursement Reimbursement of Power Tariff of Rs. 2.00 per unit for a period of 10 years from the date of commencement of commercial production
6 Interest Subsidy Interest Subsidy at the rate of 5% per annum up to a maximum limit of INR 25 crores per annum, on term loans availed from Public Financial Institutions / Banks, for a period of 7 years
7 Water Supply & Incentives The rate of water is INR 7.65 / cubic meter for the first 10 years of operation.
8 SGST Reimbursement Reimbursement of 100% of net SGST paid, overall limited to 200% of the cost of plant and machinery, provided that the SGST reimbursement shall be applicable only to the net tax paid towards the state component of GST, after the adjustment of input tax credit against output tax liability
9 Raw Materials Provide 10% capex incentives in addition to the Govt of India’s 25% incentives for raw materials & supply chain products under the SPECS scheme of Govt of India
10 Fabless companies
  • 10% of the cost of development as seed money
  • 10% of the cost of development a reimbursement on achieving milestones
  • Cap of INR 20 Crore for each project or each company of which 7.5 Cr is for PoC and 12.5 Cr for productization
  • For the first 5 Megaprojects registered by companies in Odisha will be INR 25 Crore split as INR 10 Cr for PoC & INR 15 Cr for productization
11 Patent Registration The cost of filing successful patents shall be reimbursed up to INR 5 Lakhs for domestic and INR 10 Lakhs for international patents, on actual basis (75% given when patent is filed, 25% when it is granted)
12 Manufacturing Incentives in addition to PLI Units can avail Production Linked Incentive (PLI) @1% of Net Sales Turnover (Gross Sales Turnover – Credit Notes (raised for any purpose) – Discounts (including but not limited to cash, volume, turnover, target, or for any other purpose) – applicable taxes) starting from the year of commencement of production, for 5 years subject to eligibility conditions to be notified later (as per MEiTY)
13 Semiconductor Trained Manpower & Skilling Support undergraduate program in Electronics and VLSI Design in 25 Institutes.
  • INR 10 Lakh Budget per institute for 5 years; Total of INR 2.5 Crores
Start and strengthen M. Tech program in VLSI Design in 25 Institutes
  • INR 10 Lakh Budget per institute for 5 years; Total of INR 2.5 Crores
Create a centralized EDA tools grid for supporting all academic institutions and Skilling Service Providers of The COE.
  • Common EDA Tools and Cloud Compute access with a budget of INR 10 Crores
Faculty training / technical workshops / awareness programs / expert lectures
  • INR 60 Lakhs per year for 5 years; total of INR 3.0 Crores
Internship support for B.Tech & M.Tech Graduates
  • 500 Students per year for 5 Years; INR 20K support per student.
Skilling support for manufacturing
  • INR 40 Lakhs per year for 5 years