Big blow to India as Foxconn pulls out of $19.5 billion Vedanta chip plan
By Team Newsable | First Published Jul 10, 2023, 7:07 PM ISTFoxconn said it has decided to pull out of semiconductor joint venture with Indian conglomerate Vedanta. Foxconn said it is "working to remove the Foxconn name from what now is a fully-owned entity of Vedanta".
Taiwan's Foxconn said on Monday it has withdrawn from a $19.5 billion semiconductor joint venture with Indian metals-to-oil conglomerate Vedanta, in a setback to Prime Minister Narendra Modi's chipmaking plans for India.
The largest manufacturer of contract electronics in the world, Foxconn, and Vedanta agreed to establish semiconductor and display manufacturing facilities in Gujarat last year. The electronics manufacturer stated in a statement that "Foxconn has determined it will not move forward on the joint venture with Vedanta," but did not provide any other information.
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"Foxconn has no connection to the entity and efforts to keep its original name will cause confusion for future stakeholders," Hon Hai Technology group (Foxconn) said.
According to the statement, Vedanta and Hon Hai Technology Group (Foxconn) have been working hard for more than a year to realise a remarkable semiconductor innovation. It has been a profitable experience that will provide both businesses a bright future.
Vedanta and Foxconn had been collaborating on "a great semiconductor idea" for more than a year, but they had mutually agreed to discontinue the joint venture, and Foxconn will have its name removed from what is now a totally owned Vedanta firm.
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In order to usher in a "new era" in electronics manufacturing, PM Modi has made chipmaking a major goal for India's economic strategy. Foxconn's decision is a setback to his hopes of persuading international firms to start making chips domestically.
Foxconn is best known for assembling iPhones and other goods made by Apple (AAPL.O), but in recent years it has been diversifying its business by introducing chip manufacturing. Three proposals to establish facilities under a $10 billion incentive programme were submitted last year from India, which anticipates that its semiconductor industry would be worth $63 billion by 2026.
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