Uttar Pradesh has introduced a comprehensive Semiconductor Policy 2024, offering lucrative incentives to attract chip manufacturing projects and position itself as a key player in the global semiconductor supply chain.
Uttar Pradesh is trying to turn a policy promise into an industrial proposition. The state’s Semiconductor Policy, 2024, notified on February 12, 2024, is designed to pull chip-making and related projects into a region already known for electronics manufacturing, especially around Noida, Greater Noida and the Yamuna Expressway corridor. According to the state’s investment and electronics agencies, the aim is to position Uttar Pradesh as a hub for fabrication, packaging, testing and specialist semiconductor services rather than just downstream assembly.
The policy targets a broad slice of the semiconductor chain, including fabrication plants, compound semiconductors, silicon photonics, sensors, discrete semiconductors and ATMP or OSAT facilities. Those acronyms refer to assembly, testing, marking and packaging, and outsourced assembly and test, both of which sit towards the end of the chip supply chain. The policy also extends to research centres, training institutes and supporting infrastructure, reflecting the long lead times and heavy capital needs that usually make semiconductor projects difficult to establish.
Its main draw is financial. Uttar Pradesh says it will add a capital subsidy equal to 50% of the subsidy approved by the Union government, tying the state package directly to central approval under the India Semiconductor Mission. The policy also offers a 5% annual interest subsidy for units with investments of up to ₹200 crore, with a cap of ₹1 crore a year for seven years, along with stamp duty and registration fee exemptions, electricity-duty relief for 10 years and a 50% cut in certain intra-state power charges for 25 years after commissioning.
Land support is another major incentive. The state’s official material says selected projects in compound semiconductors, silicon photonics, sensors, discrete semiconductor manufacturing and ATMP or OSAT can receive a 75% rebate on the first 200 acres bought from state agencies, plus a 30% rebate on additional land. The policy also promises help with skilling, patent reimbursement and research and development, including support for eligible centres of excellence. According to Uttar Pradesh Electronics Corporation Limited, the nodal agency for the scheme, the package is meant to improve the economics of projects that need reliable power, treated water, clean-room facilities and specialised labour.
For now, the policy is more framework than factory floor. Official material shows the incentives are in place, but consolidated public data on approved projects, land allotments, subsidy disbursals or commercial production in Uttar Pradesh remain limited. That means the policy’s real test will be whether companies move from expressions of interest to sanctioned projects, and whether the state can deliver the infrastructure and approvals that semiconductor manufacturing demands.
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