Foxconn withdraws from India’s semiconductor JV with Vedanta

Foxconn logo.
| Photo Credit: REUTERS

Taiwan-based Hon Hai Technology Group, better known as Foxconn, pulled out of its joint venture with the Vedanta Group on July 10, the firm announced in a statement. “In order to explore more diverse development opportunities, according to mutual agreement, Foxconn has determined it will not move forward on the joint venture with Vedanta,” the company said in a statement. 

Under the $19.5 billion joint venture, the two firms were set to jointly invest into a semiconductor fabrication plant in Gujarat, which would make 28 nanometre semiconductors. Foxconn was careful to state that it was not breaking away from the Indian semiconductor space entirely, and that it still supported the Indian government’s domestic chip making efforts.The firm said that it would “establish a diversity of local partnerships that meet the needs of stakeholders”.

Over the past few days, uncertainty loomed over the joint venture, amid reports that the firms were not able to fulfill the government’s push for more technology transfer and investment from European firm STMicroelectronics. 

Vedanta says other partners lined for chip plant

In a statement that did not refer to Foxconn, Vedanta said that it would forge ahead with other partners. “We will continue to grow our Semiconductor team, and we have the license for production-grade technology for 40nm [chips] from a prominent Integrated Device Manufacturer (IDM),” the company said. “India remains pivotal in repositioning global semiconductor supply chains.”

Last month, the government announced that a $2.7 billion semiconductor assembly, packaging and testing plant would be built in India by the US-headquartered firm Micron. Applications from other semiconductor proposals under a production-linked incentive scheme remain under review.

Foxconn withdrawal from Vedanta JV has no impact on India’s semiconductor goals: MoS IT

Minister of State for Electronics and Information Technology Rajeev Chandrasekhar said on Twitter that Foxconn exiting the venture would not impact India’s semiconductor ambitions. “It’s not for the government to get into why or how two private companies choose to partner or choose not to, but in simple terms … both companies can and will now pursue their strategies in India independently, and with appropriate technology partners in Semiconductors and Electronics,” Mr. Chandrasekhar said.

(With inputs from Reuters)