Economy · 18 Jul 2026

ISM 2.0 tiered subsidy structure

Match the following categories under the India Semiconductor Mission (ISM) 2.0 with their proposed capital expenditure subsidy rates: List I (Category) List II (Subsidy Rate) A. Silicon fabs 1. 25% B. Other fabs and advanced packaging 2. 35% C. Conventional packaging 3. 40% How many of the above pairs are correctly matched?

AOnly one pair
BOnly two pairs
COnly three pairs
DNone of the pairs
About this question

Why in news

The Union Cabinet approved ISM 2.0 with an outlay of ₹1.27 lakh crore, replacing the flat 50% capital subsidy under ISM 1.0 with a tiered structure and removing central subsidies for land acquisition and technology transfer.

Why for UPSC

UPSC's Match-the-Pairs format often deliberately shuffles closely-spaced numerical values to test precise recall rather than approximate understanding - exactly the discipline required here between the 40%, 35% and 25% tiers.

Prelims summary

ISM 2.0 replaces the uniform 50% capex subsidy with a tiered structure: 40% for silicon fabs, 35% for other fabs/advanced packaging and 25% for conventional packaging.

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