Taiwan-based Hon Hai Technology Group, or Foxconn, has terminated its joint venture (JV) with Vedanta Group to manufacture semiconductors in India.
The JV was announced in 2022 with a plan to invest $19.5 billion to set up semiconductor and display production plants in Gujarat. As per industry sources, concerns about incentive approval delays by India’s government contributed to Foxconn’s decision to pull out of the venture.
According to Rajeev Chandrasekhar, Minister of State for Electronics and Information Technology ans Skill Development and Entrepreneurship, Foxconn’s to withdraw from its JV wth Vedanta has no impact on India’s semiconductor fab goals. The minister said that both Foxconn and Vedanta have significant investments in India and are valued investors who are creating jobs and growth. It was well known that both companies had no prior semicon experience or technology and were expected to source fab tech from a tech partner. While their JV, Vedanta-Foxconn Semiconductors (VFSL), had originally submitted a proposal for 28-nm fab, they could not source an appropriate tech partner for that proposal, the minister noted.
Chandrasekhar added that Vedanta has recently submitted a 40-nm fab proposal backed by a tech licensing agreement from a global semiconductor major, which is currently being evaluated.