Cabinet Clears ₹2.19 Lakh Cr for Semicon 2.0, Varanasi & Rail Projects

The Union Cabinet, chaired by Prime Minister Narendra Modi, made seven significant decisions on Wednesday, July 15, 2026, collectively allocating a substantial ₹2,19,353 crore to bolster India's strategic sectors. These approvals aim to enhance domestic manufacturing capabilities, upgrade critical infrastructure, and promote self-reliance across various industries. A cornerstone of these decisions is the approval of the second edition of the India Semiconductor Mission, or Semicon 2.0, with an estimated outlay of ₹1.27 lakh crore. This substantial funding package is designed to strengthen India's semiconductor design and manufacturing ecosystem, building on the momentum generated by Semicon 1.0. The mission's term has been extended from five to twelve years, aiming to provide long-term policy stability for investors in chip design, fabrication, and packaging units. Semicon 2.0 is structured around a six-pillar roadmap, with a primary focus on chip design, developing semiconductor intellectual property (IP), and positioning India as a global leader in semiconductor design. This initiative is expected to attract investments of around ₹4 lakh crore and contribute to semiconductor production worth ₹2 lakh crore over the scheme period. In a major push for urban infrastructure, especially in the sacred city of Varanasi (Kashi), the Cabinet Committee on Economic Affairs (CCEA) approved two elevated corridor projects totaling over ₹25,445 crore. The projects include a 43.218-km Varuna River Elevated Corridor, with an estimated cost of ₹10,998.32 crore, connecting National Highway-31 (NH-31) with the Varanasi Ring Road. The second project is a 46.039-km Ganga River Elevated Corridor, costing ₹14,447.64 crore, linking NH-19 with the Varanasi Ring Road. Both projects will be executed under the Hybrid Annuity Model (HAM) by the National Highways Authority of India (NHAI) and are aimed at significantly easing traffic congestion, improving connectivity, and strengthening multimodal transport infrastructure in Varanasi. The Varuna corridor is expected to reduce travel time between NH-31 and Kashi Railway Station from approximately 40 minutes to 20 minutes, while the Ganga corridor will feature an iconic 910-meter cable-stayed bridge. Further enhancing national connectivity, the Cabinet approved two multitracking railway projects valued at ₹3,907 crore. These projects, critical for boosting rail capacity and freight movement, include the doubling of the Paradeep–Haridaspur railway line in Odisha, with an investment of ₹2,542 crore. The second railway project involves the construction of a fourth railway line between Rajkharsawan and Dangoaposi, spanning across parts of Odisha and Jharkhand, at a cost of ₹1,365 crore. These initiatives, scheduled for completion by 2030-31, will add approximately 145 kilometers to the Indian Railways network, improving operational efficiency and supporting the movement of essential commodities like coal and iron ore. Another significant decision was the approval of the Mobile Phone Manufacturing Scheme (MPMS) with an outlay of ₹62,500 crore. This scheme, an extension or second edition, aims to further boost domestic electronics manufacturing capabilities and strengthen India's position in the global supply chain. Additionally, the National Investment Policy for Urea-2026 was cleared, focusing on making India self-reliant in urea production and reducing dependence on imports. This policy aims to establish new urea plants and ensure the continued provision of subsidized fertilizers to farmers. Union Electronics and Information Technology Minister Ashwini Vaishnaw highlighted that these seven major decisions underscore the government's commitment to long-term policy support and strategic capital spending to foster industrial self-reliance and robust economic growth across key sectors.

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