Foxconn-Vedanta Deal News: Taiwanese electronics maker Foxconn has ended its semiconductor deal with Vedanta. Foxconn has announced its separation from the proposed semiconductor manufacturing joint venture on Monday (July 10). After this announcement, the Center has said that this decision will not affect India’s semiconductor program. While the Congress has taunted the central government. Know the big things related to this matter.
1. Taiwanese electronics company Foxconn announced its exit from industrialist Anil Agarwal’s joint venture with Vedanta. The venture was to set up a semiconductor manufacturing plant in Gujarat with an investment of $19.5 billion (about Rs 1.5 lakh crore).
2. Challenges for this venture had increased due to the inability to find a technology partner to make chips used in mobile phones to refrigerators and cars. Both Foxconn and Vedanta do not have any prior experience or technology in making chips. They were expected to get it from a technology partner.
3. Foxconn said it has decided not to go ahead with the joint venture with Vedanta. Now this venture belongs to Vedanta alone. To this Vedanta said that it is fully committed to the semiconductor manufacturing plant and is in touch with some partners to set up India’s first semiconductor plant. However, Vedanta did not give any details of its new partners.
4. After Foxconn’s announcement, Electronics and Information Technology Minister Ashwini Vaishnav said that Taiwan’s electronics manufacturing company Foxconn and mining major Vedanta are committed to the country’s semiconductor mission and Make-in-India programme. He told NDTV that Foxconn’s exit from this venture will not affect India’s semiconductor program.
5. Vedanta and Foxconn signed an agreement in September 2022 to invest $19.5 billion to set up semiconductor and display manufacturing plants in Gujarat. In May this year, the JV was reported to be facing challenges as it could not find a technology partner.
6. Talks were on to bring European chip maker STMicroelectronics as a technology partner to the joint venture, but no agreement could be reached. The government is trying to make India a new center of semiconductor manufacturing. For this, the government has also started an incentive scheme.
7. Minister of State for Electronics and Information Technology Rajeev Chandrasekhar tweeted that Foxconn’s decision to pull out of its joint venture with Vedanta would have no impact on India’s semiconductor program goals.
8. Rajeev Chandrasekhar further said that both Foxconn and Vedanta have significant investments in India and are valuable investors who are creating jobs and growth. It was already known that both companies had no prior semiconductor experience or technology and were expected to acquire fab technology from the tech partner. They had submitted a proposal for 28 nm fab, they could not find a suitable tech partner for that proposal.
9. The Union Minister said that after getting the approval from PM Modi, India’s strategy regarding semiconductor ecosystem has seen rapid progress in 18 months. For those who are calling this decision of Foxconn and Vedanta a blow to India’s Semicon ambition, I can only say that betting against India on the work being done under the leadership of PM Modi is a bad idea.
10. Congress General Secretary Jairam Ramesh has targeted the central government regarding this matter. He tweeted that while Foxconn-Vedanta is closed, it seems that Micron is still working on semiconductor chip assembly, packaging and testing. However, Micron is putting up only 30% of the $2.75 billion, with 50% coming from the Center and 20% from the Gujarat government. By any standard, this appears to be a huge subsidy for an American company.
(also input from PTI)
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