After its recent joint venture with Foxconn to set up semiconductor and display production plants in Gujarat fell through, many wrote off the Indian conglomerate, and it was seen as a huge setback. However, the failed Vedanta-Foxconn venture is likely to have a positive outcome in disguise. Instead of a single project, there will now be two semiconductor projects, as Foxconn has decided to pursue its own venture.
During their 58th General meeting held today, Vedanta chairman Anil Agarwal declared, “We have lined up partners for our semiconductor venture. These Ventures will enable our youth to access affordable electronic devices, all of which will help them fulfil their aspirations.” The statement indicated that Vedanta is still in the game.
In another development, Micron, one of the world’s largest semiconductor companies announced plans to build a new assembly and test facility in Gujarat, entailing a total investment of USD 2.75 billion.
Micron could well be an alternative to Foxconn for Vedanta. Given the company’s history in the field, it could also be the ideal technological partner that the Indian firm has yet failed to come to agreements with. Micron’s expertise would not only further Vedanta’s cause but help shorten the span of actual output.
Micron is willing to put in $825 million while the rest will be financed by the government in two phases.
All is Not Lost for Vedanta
Moreover, Vedanta has already expressed full commitment to its semiconductor fabrication project and has formed alliances with other partners. Less than a week ago, Vedanta announced the acquisition of the semiconductor and display business from Twin Star Technologies Ltd, which is an entity of Volcan Investments Ltd—the ultimate holding company of Vedanta.
This will position it as the first company in India’s integrated semiconductor and display fabrication business. This is in line with the vision and stance of Vedanta chairman and founder Anil Agarwal on manufacturing in India and making the country a hub for semiconductors and their export. “Semiconductor is today’s oil; we are chip takers (India) and we will become chip makers and this will change our country,” Agarwal had said in an interview.
Agarwal has been at the forefront of India’s semiconductor push and has declared his complete commitment to the cause. “Vedanta is committed to making India self-reliant in electronics. This is the beginning of the creation of a Silicon Valley in India, a cutting-edge and world-class electronics ecosystem. My dream is for every Indian youth to have an affordable smartphone, laptop and an electric vehicle,” Agarwal said in a statement.
Vedanta had also previously said that Indian-made semiconductors and display glass will lead to affordable electronics for all Indians, and getting hands-on smartphones, laptops, televisions, and electric vehicles will become easier.
Catalyst for India Semiconductor Space
Even though the joint venture between Vedanta and Foxconn fell off, it will act as a catalyst to the overall electronics and semiconductor ecosystem. Recently, a slew of developments seem to have rejuvenated the conversation around the semiconductor industry in India, as the country looks to position itself as one of the leading players in the field.
Applied Materials—a leading semiconductor equipment maker announced its plans to invest $400 million in the next four years to build a collaborative engineering centre in Bengaluru. This centre will primarily concentrate on the advancement and implementation of technologies related to semiconductor manufacturing equipment.
Additionally, Lam Research has put forth a proposal to train 60,000 Indian engineers using its Semiverse Solution virtual fabrication platform. The objective of this initiative is to accelerate India’s goals in semiconductor education and workforce development. This could add to Vedanta’s momentum, as an educated workforce could help bring about homegrown innovation in the field powering advancements.
MoS for electronics and IT Rajeev Chandrasekhar also addressed the deal falling through, and said that the Taiwanese electronics manufacturer Foxconn’s decision to pull out of Vedanta joint venture has no impact on India’s semiconductor fabrication plant goal, “This decision of Foxconn to withdraw from its JV with Vedanta has no impact on India’s Semiconductor Fab goals. None,” Chandrasekhar tweeted.
“It’s not for govt to get into why or how two private companies choose to partner or choose not to, but in simple terms it means both companies can & will now pursue their strategies in India independently, and with appropriate technology partners in Semicon n Electronics,” Chandrasekhar tweeted.
Agarwal, during the company’s general meeting also praised the government and its initiative. He said, “The government led by PM Modi has proactively rolled out the progressive policies for the domestic manufacturing of semiconductors and display back in India this year, subject to government approval, your company will begin a foray into the semiconductor and display fab.”
He also added and has maintained that our country could stand to benefit from the US-China sanction war. “Our country stands to be the financial beneficiary of the China plus one strategy as we have a government that has a razor-sharp focus on creating an investment-friendly environment,” Agarwal said.
