On Tuesday 13 September, the joint venture between Vedanta and Taiwan base Foxconn Group announced that it will open a new semiconductor and chip manufacturing plant in Gujarat.
Vedanta is the third company to announce a chip plant in India. Earlier Singapore-based IGSS Ventures signed an MoU (Memorandum of understanding) with the Tamil Nadu state government and Israeli conglomerate ISMC signed an LOI (letter of intent) with Karnataka state.
Vedanta has signed a Memorandum of Understanding (MoU) with the Gujarat government to set up a Semiconductor Assembling and Testing Unit, Semiconductor Fab Unit, and Display Fab Unit in the Ahmedabad district, the company said in a statement.
The total investment of this plant will be $19.5 billion (₹1.54 trillion) and the estimation of the company is that this plant will create a total of 1 lakh new direct and indirect jobs in Gujarat. According to the company, the Vedanta-Foxconn joint venture “FABS” semiconductor fabrication plants aims to start manufacturing display and chip products within two years.
Of the Rs 1.54 trillion investment, Vedanta will invest Rs 600 billion in chip-related manufacturing units and set up a display manufacturing unit with an investment of Rs 945 billion.
According to the data, India’s domestic production in electronics has grown to $67 billion in 2020-21, which contributes 2.7% to the GDP. The Indian electronics market is $118 billion and presently India’s semiconductor demand is fully met by imports now semiconductor manufacturing in India can bring down the price of many electronic items significantly.
Vedanta Chairman Anil Agarwal said in an interview that the company will also set up a new iPhone and TV equipment manufacturing hub in Maharashtra. This plant could also be built in collaboration with the Foxconn Group, as Foxconn is the world’s largest contract electronics manufacturer and one of the biggest assemblers of the iPhone (major supplier of Apple).
India is projected to reach a $15 billion display market by 2025 and a $110 billion semiconductor market by 2030, while India’s semiconductor market stood at $15 billion in 2020.