Vedanta-Foxconn JV to set up semiconductors and display fab units with investment of Rs 1.54 lakh crore

Vedanta-Foxconn JV to set up semiconductors and display fab units with investment of Rs 1.54 lakh crore

Ahmedabad, September 13, 2022

Leading global natural resources conglomerate Vedanta today signed two memoranda of understanding (MoUs) with the Government of Gujarat to set up a semiconductor fabunit, a display fab unit, and a semiconductor assembling and testing unit in Ahmedabad district of the state.

The project, to be set up by a joint venture formed by Vedanta and Foxconn, envisages total investment of Rs 1.54 lakh crore and will provide employment to around 1 lakh people, a press release from Vedanta said.

According to it, the projects will be a major step towards making India self-sufficient in the critical area of semiconductors and displays in line with Prime Minister Narendra Modi’s vision to make India "aatmanirbhar" (self-reliant) in key futuristic technologies.

Union Minister for Electronics & Information Technology Ashwini Vaishnaw, Gujarat Chief Minister Bhupendrabhai Patel and Vedanta Group Chairman Anil Agarwal were among those present on the occasion.

The release said the project would attract electronics ecosystem players across the value chain entailing manufacturers of highly sophisticated and sensitive equipment, materials (high purity gases, chemicals, wafers, photomasks), equipment servic providers, and so on, and put the state of Gujarat on the global silicon map.

The proposed semiconductor manufacturing fab unit will operate on the 28nm technology nodes and the display manufacturing unit will produce Generation 8 displays catering to small, medium and large applications.

Vedanta will hold 60% of the equity in the joint venture (JV) while Foxconn will own 40%. The JV will look at setting up a semiconductor manufacturing plant in the next two years, the release said.

"We are extremely proud and happy that the Vedanta-Foxconn JV has selected the industrial state of Gujarat for their semiconductor plant. This is a huge investment coming on the day when we complete one year in office which is also a testimony to the policy stability and policy support coupled with good governance & excellent infrastructure facilities existing in Gujarat. We will provide all help to the joint venture so that the plant can start its operations soon. We are determined to make our country more self-sufficient in tech and curb our reliance on imports from other countries. We sincerely hope that the hub will be the beginning of a bright future and attract investment from other multinational companies down the line,” Patel said on the occasion.

He added that the Gujarat Government has created a world-class industrial zone, with excellent infrastructure facilities to help strategic investments such as the semiconductor plant, to mitigate the gestation period of project timelines.

“The project will be met with red carpet in Gujarat instead of any red tapism”, he said.

Vaishnaw said, “ The project is in line with Prime Minister Narendra Modi’s vision for achieving self-reliance in the field of semiconductor manufacturing. I congratulate Vedanta and Foxconn for taking this initiative and bringing the semi-conductor plant to India. The Gujarat plant will go a long way in helping build $1 trillion digital national economy."

The decision to set up the project in Gujarat comes after Vedanta and Foxconn announced in February that they will form a joint venture company in India.

Vedanta has a presence in electronics and technology business through group companies Avanstrate Inc. and Sterlite Technologies.

Hon Hai Technology Group (Foxconn) is the world's largest electronics manufacturer. Hon Hai is also the leading technology solution provider, and it continuously leverages its expertise in software and hardware to integrate its unique manufacturing systems with emerging technologies.

Brian Ho, Vice-President, Foxconn Semiconductor Group, also present at the event, said, "I am delighted that the semiconductor plant will come up in the industrial state of Gujarat. We applaud the efforts made by the Government of Gujarat, home of Prime Minister Narendra Modi, to attract semiconductor development and upgrade government efficiency. Located in the western part of India, Gujarat has been recognized for its industrial development, green energy, and smart cities. The improving infrastructure and the government's active and strong support increases confidence in setting up a semiconductor factory. We look forward to working with our partners and the Gujarat leadership to further enhance the infrastructure required to cater to the ambitious semiconductor project."

The broad plans for a semiconductor unit in India were announced after the COVID-19 pandemic upended global supplies of crucial electronic components used in everything from smartphones to cars. India has vowed to spend $30 billion to overhaul its tech industry and build local chip supply chains to avoid being dependent on foreign producers.

Vedanta Limited, a subsidiary of Vedanta Resources Limited, is one of the world's leading oil & gas and metals company with significant operations in oil & gas, zinc, lead, silver, copper, iron ore, steel, aluminium and power across India, South Africa and Namibia.

Vedanta is partnering with Foxconn for semiconductors manufacturing. Initial investment in the project will be $2 billion, which will go up to $20 billion, the release said.

Vedanta group company, AvanStrate is already the fourth largest producer of glass globally while Sterlite Technologies is catering to telecom companies, focussed on 5G and is the largest producer of optic fibre, cables, accessories with plants in Italy, Brazil, China.

NNN

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