India's DLI Scheme Backs 24 Startups and 23 Chip Tapeouts

India's DLI Scheme: Building a Fabless Chip Design Ecosystem

India's Design Linked Incentive (DLI) scheme, administered under the India Semiconductor Mission, has now supported 24 semiconductor design startups, facilitated 23 chip tapeouts at domestic and international foundries, and provided EDA tool access to 105 companies, making it one of the most active government-backed chip design incentive programs globally for a country at India's stage of semiconductor development. Companies supported under the DLI scheme include AGNIT Semiconductors (GaN chips for defence and telecom), Sensesemi Technologies (edge AI wearable chips), WiSig Networks (5G and satellite IoT chips), Netrasemi (edge AI SoC), FermionIC Design (RF and mmWave chips), and a broader cohort of companies working across automotive, industrial, consumer and defence applications.

How the DLI Scheme Works

The DLI scheme provides eligible semiconductor design startups with financial support covering up to 50 percent of eligible design development expenses, access to industry-standard EDA (Electronic Design Automation) tools at subsidised rates through government-negotiated agreements with Cadence, Synopsys and Siemens EDA, and access to foundry services at preferred pricing through ISM-negotiated arrangements with participating foundries. The scheme is structured to support companies through the pre-commercial phase, from initial design concept through first silicon tapeout, with the expectation that commercial revenue from customer engagements or IP licensing will follow successful silicon validation.

Venture Capital Signal

DLI-backed companies have collectively attracted nearly ₹430 crore in venture capital funding, a figure that reflects growing institutional investor confidence in India's chip design ecosystem as a source of investable companies. The combination of government grant support reducing the financial risk of early design work and the visible milestones of completed tapeouts giving investors concrete technical proof points has made DLI-scheme participants more fundable than comparable-stage chip startups operating without government support, a policy design feature that mirrors the role of DARPA and SBIR grants in the US semiconductor startup ecosystem.

23 Tapeouts: From Design to Silicon

The completion of 23 tapeouts across DLI participants is a meaningful milestone because tapeout, the moment a chip design is finalised and sent to a foundry for manufacturing, is the point at which design claims must be validated against the physical realities of transistor-level silicon. Each tapeout represents a company that has progressed from concept to a manufacturable chip design, a step that the majority of semiconductor startups globally never reach. The 23 tapeouts include designs at multiple nodes ranging from mature processes used in RF and power chips through to advanced nodes for digital compute applications.

ISM 2.0: Scaling to 100+ Companies

Under ISM 2.0, the DLI scheme is being significantly expanded, with a target of supporting over 100 semiconductor design companies in the next phase of the program. The expanded scheme will increase the range of design categories covered, add support for design-to-product commercialisation activities beyond tapeout, and introduce market linkage programs connecting DLI startups with potential customers in India's defence, automotive, industrial and consumer electronics sectors.

Building India's Design IP Base

The DLI scheme's long-term significance lies not just in the companies it supports but in the indigenous chip design intellectual property being created by those companies. Unlike contract design services work, where IP ownership remains with the customer, DLI-scheme product companies own their chip designs, patents, and product roadmaps, creating a base of Indian-owned semiconductor IP that can support long-term technology companies rather than service businesses. This IP ownership distinction is central to ISM 2.0's ambition to position India as a product-led chip design power, not just a design services export platform.