Foxconn Withdraws From $19.5 Billion JV With Vedanta For Mega Semiconductor Plant In India

Taiwan's Foxconn announced its decision on Monday (10 July) to withdraw from a joint venture with Vedanta Ltd, led by billionaire Anil Agarwal, which was established to produce semiconductors in India.

Last year, Foxconn and Vedanta signed an agreement to invest $19.5 billion in setting up semiconductor and display production plants in Gujarat, as part of India's plans to become a major player in the electronics industry.

In a statement, Foxconn expressed its intention to remove its name from the fully-owned entity of Vedanta, stating that any efforts to retain the original name would cause confusion for future stakeholders.

However, Foxconn expressed confidence in India's semiconductor development and pledged to continue supporting the government's "Make In India" initiative by establishing local partnerships that meet stakeholder needs.

Last week, Vedanta Group acquired full ownership of the joint venture with Foxconn, which was known as Vedanta Foxconn Semiconductors Private Limited and operated as a wholly-owned subsidiary of Twin Star Technologies Limited, an entity of the Vedanta group.

This restructuring positions Vedanta as India's first company in the Integrated Semiconductor and Display Fab Business. It marks Vedanta Limited's expansion into semiconductors and display glass manufacturing, diversifying its portfolio.

In previous developments, Vedanta had signed an in-principle agreement with the Gujarat government to establish a semiconductor and display manufacturing unit worth INR 1.54 lakh crore ($20.6 billion) in Gujarat.

Initially, Vedanta had announced a partnership with Foxconn to set up the unit, but the location was later reported to be Maharashtra. Vedanta would have held a 60 per cent equity share in the venture, with Foxconn owning the remaining 40 per cet. However, it seems that the project did not progress as planned.

India's semiconductor market is expected to reach $63 billion by 2026, and the government has received applications for setting up plants under a $10 billion incentive scheme.