Vedanta Ltd Chairman Anil Agarwal reiterated that the company is still committed to its plan to set up a semiconductor manufacturing unit, dismissing talks that the government may have put on the backburner the metals and mining company’s plan to foray into the sector.
Last year in July, Foxconn and Vedanta group called off their joint venture that had ambitious plans to invest $19.5 billion to set up a manufacturing unit in Gujarat. Both said they would go ahead with their respective semiconductor business ventures with new partners. Since then, there have been reports that the plan may get shelved, which Vedanta has denied.
“It is not a child's play. We are doing the semiconductor project. We are there. We are submitting, we are talking. We are working on it,” Agarwal said in response to media reports that the company has not submitted a final plan to the government for approval.
On February 5, Business Standard reported, quoting the minister of state for electronics and information technology, Rajeev Chandrasekhar, that the government is not looking at Vedanta’s plans as serious proposals in the absence of a technology partner and a new proposal.
“We are working on two projects–one is the (display) glass and one is your semiconductor. We have submitted everything,” Agarwal said, as he spoke to Moneycontrol on the sidelines of India Energy Week (IEW) in Goa.
The group led by Agarwal had entered the semiconductor and display glass business venture through Twin Star Technologies Limited (TSTL), a wholly-owned subsidiary of Volcan Investments Limited, the ultimate holding company of the Indian listed entity Vedanta Ltd and part of the promoter group. The joint venture with Foxconn was under this entity. Both partners did not have experience but planned to rope in a technology partner.
The Vedanta group’s decision to move the ownership of its new ventures from the promoter group entity to the India-listed company was seen as the immediate trigger while many industry players argue that it was a long time coming.
“Leave aside Vedanta, India has to produce semiconductors. If India does not produce semiconductors, how do we grow? How do we compete with the first world?” he said.
Separately, Foxconn too has maintained that it will take its plan ahead to set up a fab plant in India.
The government had launched the Semicon India Programme in December 2021 with an outlay of Rs 76,000 crore for the development of semiconductors and display manufacturing ecosystem in India.
Under the programme, fiscal incentive of 50 percent of the project cost is available to companies/consortia/ joint ventures for setting up of semiconductor fabs in India of any node size (including mature nodes). Similarly, a fiscal incentive of 50 percent of the project cost is available for setting up of display fabs of specified technologies in India.
The application window for the scheme is open till December 2024.
Application window of a separate Rs 1,100 crore Design Linked Incentive Scheme (for design of chips) is also open till December 2024. Dozens of applications have been received under DLI Scheme and several applications have been granted approval.
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