Foxconn Withdraws, Vedanta Says Other Partners Lined For Chip Plant

After withdrawal of Taiwanese electronic contract manufacturer Foxconn from its chip joint venture, Vedanta on Monday asserted that it is fully committed to its semiconductor project and has lined up other partners to set up India's first foundry.

Foxconn on Monday said it has decided to pull out of semiconductor joint venture with Indian conglomerate Vedanta, according to a statement. Foxconn said it is "working to remove the Foxconn name from what now is a fully-owned entity of Vedanta."

"Foxconn has no connection to the entity and efforts to keep its original name will cause confusion for future stakeholders," Hon Hai Technology group (Foxconn) said.

Vedanta said that it has redoubled efforts to fulfil Prime Minister Narendra Modi's vision for semiconductors and affirmed that India remains pivotal in repositioning global semiconductor supply chains.

"Vedanta reiterates that it is fully committed to its semiconductor fab project, and we have lined up other partners to set up India’s first foundry. We will continue to grow our Semiconductor team, and we have the license for production-grade technology for 40 nm from a prominent Integrated Device Manufacturer," Vedanta said in a statement.

"We will shortly acquire a licence for production-grade 28 nm as well. Vedanta has redoubled its efforts to fulfil the prime minister's vision for semiconductors, and India remains pivotal in repositioning global semiconductor supply chains," the statement said.

Reacting to Foxconn's withdrawal, Minister of State for Electronics and IT Rajeev Chandrasekhar said the company's decision to pull out of the Vedanta joint venture has no impact on India's semiconductor fabrication plant goal.

"This decision of Foxconn to withdraw from its JV wth Vedanta has no impact on India's Semiconductor Fab goals. None," Chandrasekhar tweeted.

He said that Vedanta, through JV VFSL, has recently submitted a 40 nm fab proposal backed by a technology licencing agreement from a Global Semiconductor major, which is currently being evaluated by the government's Semicon India Tech Advisory Group.

Foxconn, the global contract electronics maker, and Vedanta had inked an agreement last year to build semiconductor and display production plants in Gujarat entailing an investment of about Rs 1.5 lakh crore.

In a statement on Monday Foxconn said: "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 statement said that for over a year Hon Hai Technology Group (Foxconn) and Vedanta have worked hard to bring a great semiconductor idea to reality. It has been a fruitful experience that can position both companies strongly going forward.

"Foxconn is confident about the direction of India's semiconductor development. We will continue to strongly support the government's 'Make In India' ambitions and establish a diversity of local partnerships that meet the needs of stakeholders," it said.