Mining giant Vedanta and Taiwan's Hon Hai Technology Group aka Foxconn have agreed to set up a semiconductors manufacturing industry in India, as per a joint statement released on Wednesday.
The two companies have signed a Memorandum of Understanding (MoU) to set up a joint venture which will manufacture semiconductors in India. “This first-of-its-kind joint venture between the two companies will support Indian Prime Minister Narendra Modi’s vision to create an ecosystem for semiconductor manufacturing in India… Vedanta will hold the majority of the equity in the JV, while Foxconn will be the minority shareholder. Vedanta Chairman Anil Agarwal will be the Chairman of the joint venture company,” a press release by Foxconn read.
Once the joint venture is set up, it will significantly boost India’s manufacturing capacity in the field of electronics as well as help realise the national goal of “Atmanirbharta” or self-sufficiency in terms of critical technology.
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Foxconn will invest around ₹900 crore in the joint venture and hold about 40 percent of the its shares. Both the companies are in talks with several state governments to implement their manufacturing proposals.
This JV is first proposed under the Indian government’s Production linked Initiative (PLI) scheme worth around ₹76000 crore to propel India into a select group of countries which can manufacture semiconductors. The move comes crucial as semiconductors make up a critical component in manufacturing electronic items used in critical hardware for both civilian and military use. India’s push for its ambitious “Make in India” mandates local manufacturing to secure semiconductors supply especially in the wake of supply chain crisis which has led to its shortages across the world. This will also boost exports thereby creating jobs, adding to foreign exchange and boosting the country’s industrialization.
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Vedanta is a major Indian mining conglomerate led by Anil Agarwal. Foxconn is a Taiwanese company and the largest electronics manufacturer in the world. Last year, it was reported that Indian conglomerate Tata is looking to manufacture semiconductors in India with an investment of ₹300 million.
