India’s southern chip state has stopped waiting on New Delhi. The Tamil Nadu Semiconductor Ecosystem Scheme 2026, notified on Oct 6 and launched on Oct 15 by Chief Minister C Joseph Vijay, splits support into two tracks so that a project turned down under the union government’s Semicon 2.0 programme can still get money.
Track one tops up approved projects. A 300mm silicon fab or an advanced packaging line gets a 25 percent state investment subsidy on eligible capex, on top of the central 40 percent. Legacy packaging draws 20 percent. Equipment, materials, testing and R&D facilities sit at 15 percent.
Track two is the novel part. Firms that never applied, or applied and lost, can claim a fixed 15 to 25 percent of eligible fixed assets plus a turnover-linked subsidy of up to 2 percent a year for five years. Minimum investments start at INR 50 crore for some materials and packaging products and reach INR 500 crore for advanced packaging.
Employment strings are attached. At least half of a project’s direct workforce must be Tamil Nadu residents, and 60 percent of jobs paying above INR 25,000 a month.
Add-ons cover training at INR 10,000 per head per month, payroll support, land and stamp duty relief, five years of electricity tax exemption and a 5 percent interest subsidy on term loans for six years. Proposals are due to Guidance Tamil Nadu by Sep 30, 2027.
