Foxconn's decision to scrap its tie-up with the Anil Agrawal-led Vedanta for the semiconductor business in India will have no adverse impact on the country's plan towards the sector, said Rajeev Chandrasekhar, the Union Minister of State for Electronics and IT, on July 10.
"This decision of Foxconn to withdraw from its JV with Vedanta has no impact on India's semiconductor fab goals. None. (sic)," the minister tweeted, adding that both the companies have significant investments in India and are "valued investors who are creating jobs and growth".
This was reiterated by Union IT and Electronics Minister Ashwini Vaishnaw, said that "both Foxconn and Vedanta are fully committed to India’s Semiconductor Mission and Make in India".
Government sources who spoke to CNBC TV-18 added that Foxconn and Vedanta are still in the fray with semiconductor plans for India, and will pursue their plans independently with different technology partners.
Foxconn, a global electronics manufacturing giant, issued a statement today confirming its decision to not to proceed with its tie-up with Vedanta. The company said it working to remove the Foxconn name from the joint venture which is 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," the Taiwanese company noted.
Also Read | Foxconn scraps tie-up with Vedanta year after announcing chip JV: Here's a timeline
The Vedanta-Foxconn Semiconductors Ltd (VFSL) was set up by the two entities last year to set up a semiconductor manufacturing unit in Gujarat. However, the JV could not make progress as it reportedly struggled to find a technology partner for the production of 28-nanometer chips.
"It was well known that both companies had no prior semicon experience or technology and were expected to source fab tech from a tech partner. While their JV VFSL had originally submitted a proposal for 28nm fab, they could not source appropriate Tech partner for that proposal (sic)," Chandrasekhar said.
The minister add that Vedanta, through VFSL, recently submitted a 40nm fab proposal "backed by tech licensing agreement from a global semicon major". The proposal is currently being evaluated by Semicon India
Tech Advisory Group, he noted.
Chandrasekhar expressed confidence that both - Vedanta and Foxconn - will pursue their semiconductor plans independently in the country.
"It is not for the government 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 and will now pursue their strategies in India independently, and with appropriate technology partners in semicon and electronics," he said.
Meanwhile, Vedanta in a separate statement said it is "fully committed" to its semiconductor fab project in India. "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 (IDM). We will shortly acquire a license for production-grade 28 nm as well," it said.
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