India’s first chip factory, $20 billion, is located in Gujarat: a 10-point guide – Flying Journals


India's first chip factory, $20 billion, is located in Gujarat: a 10-point guide

Semiconductor chips are an essential part of many digital consumer products—from cars to cell phones

New Delhi:
Mining group Vedanta and Taiwanese electronics manufacturing giant Foxconn will invest 1.54 billion rupees to build India’s first semiconductor production plant in Gujarat.

Here are 10 things to know about the Vedanta-Foxconn deal:

  1. The 1.54 billion rupees invested by Vedanta and Foxconn will be used to build India’s first semiconductor manufacturing plant, a display factory and a semiconductor assembly and testing unit.

  2. The factories will be built on 1,000 acres of land in Ahmedabad.

  3. “The plant will start production within two years,” Vedanta chairman Anil Agarwal told PTI after signing a memorandum of understanding (MoU) with the Gujarat government.

  4. Foxconn is serving as a technology partner, while oil and metals conglomerate Vedanta is financing the project.

  5. Vedanta and Foxconn will work closely with the state government to build high-tech clusters with the necessary infrastructure, including land, semiconductor-grade water and electricity, the companies said in a joint statement.

  6. The companies also said the project will create more than 100,000 jobs in Gujarat.

  7. Semiconductor chips, or microchips, are an essential part of many digital consumer products—from automobiles to cell phones and ATM cards. The Indian semiconductor market is worth $27.2 billion in 2021 and is expected to grow at a healthy CAGR of nearly 19% to reach $64 billion by 2026. But so far, none of these chips are made in India.

  8. Vedanta is the third company to announce a chip factory in India, following international consortium ISMC and Singapore-based IGSS Ventures, in Karnataka and Tamil Nadu respectively.

  9. Severe shortages in the semiconductor supply chain last year affected many industries, including electronics and automotive.

  10. To reduce reliance on imports from countries such as Taiwan and China, the government has introduced a financial incentive scheme for semiconductors manufactured in the country. Vedanta-Foxconn is one of the successful applicants for the Semiconductor Production Linked Incentive (PLI) program.



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