According to two people who spoke to Reuters, Vedanta Ltd. has chosen Gujarat, the home state of Indian Prime Minister Narendra Modi, for its semiconductor project. This is the first significant step in the company’s $20 billion joint venture with Foxconn of Taiwan.
According to the first source with information on the situation, Vedanta received financial and non-financial subsidies, including capital expenditure and affordable electricity from Gujarat, to establish the semiconductor factory.
The source added, declining to be identified before an official announcement, that the project will comprise display and semiconductor facilities close to Ahmedabad, the state’s main city.
According to a Reuters article from April, Vedanta had requested incentives like 1,000 acres (405 hectares) of free land on a 99-year lease as well as water and power at set, discounted rates for 20 years.
Requests for comment from Foxconn and Vedanta’s spokespersons were not immediately answered.
Senior representatives from the Gujarat Department of Science and Technology and the office of Chief Minister Bhupendrabhai Patel declined to comment.
A formal announcement and memorandum of understanding signing between the two parties are anticipated this week. Patel and Vedanta representatives are likely to attend, the person said.
Telangana and Karnataka in the south, as well as Maharashtra, the wealthiest state in India, had also been considered as potential locations for the Vedanta-Foxconn megaproject.
But in the most recent round of negotiations, Gujarat edged out Maharashtra.
According to the government, the Indian semiconductor market would grow from $15 billion in 2020 to $63 billion by 2026.
Few nations, including Taiwan, produce the majority of the world’s chips, and India, a late entry, is now actively courting businesses to “usher in a new age in electronics production” as it looks for ways to have easy access to chips.
Oil-to-metals conglomerate Vedanta made the decision to diversify into chip manufacturing and establish the joint venture with Foxconn in February.
