Vedanta and Foxconn, the Taiwanese electronics manufacturing giant, will invest 1.54 lakh crore to build India’s first semiconductor manufacturing plant in Gujarat.
Here are 10 things about the Vedanta-Foxconn deal:
- The ₹ 1.54 lakh crore investment by Vedanta and Foxconn will be used to set up India’s first semiconductor production plant, a display fab unit, and a semiconductor assembling and testing unit.
- The plants will be set up on a 1000-acre land in Ahmedabad.
- “The plant will start production in two years,” Vedanta chairman Anil Agarwal told PTI after signing the memorandum of understanding (MoU) with the Gujarat government.
- Foxconn is acting as the technical partner, while oil-to-metals conglomerate Vedanta is financing the project.
- Vedanta and Foxconn will work closely with the state government to establish high-tech clusters with requisite infrastructure, including land, semiconductor-grade water, and power, the companies said in a joint statement.
- The companies also said the project will create more than 100,000 jobs in Gujarat.
- Semiconductor chips, or microchips, are essential pieces of many digital consumer products – from cars to mobile phones and ATM cards. The Indian semiconductor market was valued at $27.2 billion in 2021 and is expected to grow at a healthy CAGR of nearly 19 per cent to reach $64 billion in 2026. But none of these chips is manufactured in India so far.
- Vedanta is the third company to announce a chip plant location in India after international consortium ISMC and Singapore-based IGSS Ventures, which are setting up in Karnataka and Tamil Nadu respectively.
- A massive shortage in the semiconductor supply chain last year affected many industries, including electronics and automotive.
- To cut dependence on imports from nations like Taiwan and China, the government brought a fiscal incentive scheme for manufacturing semiconductors in the country. Vedanta-Foxconn is one of the successful applicants for the Production Linked Incentive (PLI) scheme for semiconductors.