Vedanta revealed plans to launch a joint venture with Foxconn in February.
HIGHLIGHTS
1. Vedanta's proposal will require a $2 billion investment in the first phase.
2. India's semiconductor business is expected to reach $63 billion by 2026, according to forecasts.
3. Vedanta has yet to meet with private equity firms.
Vedanta will choose a location in India for its $20 billion (approximately Rs. 1,55,273 crore) semiconductor and display plants by mid-June, and the first chip product will be available in two years, according to company Chairman Anil Agarwal.
Vedanta, an oil-to-metals conglomerate, unveiled intentions in February to diversify into chip production and form a joint venture with Taiwan's Foxconn to help Prime Minister Narendra Modi's aim to make India a semiconductor manufacturing hub.
Vedanta intends to invest a total of $20 billion in two independent semiconductor and display production units.
"Our technological partner is Foxconn. For the fab, we may not take on an equity partner "In a Davos interview, Agarwal told Reuters that the Apple contract manufacturer will be responsible for all aspects of the operation, from providing technology to manufacturing semiconductors.
Vedanta is seeking incentives from Modi's government and is in discussions with a number of Indian states about the placement of the operation.
On the sidelines of the annual World Economic Forum, Agarwal stated that the first phase of Vedanta's project will require a $2 billion investment (roughly Rs.15,523 crore).
He stated that private equity firms want to be a part of India's semiconductor boom and that there is no scarcity of capital, but that Vedanta had yet to hold negotiations with PE firms.
By 2026, India's semiconductor market is expected to have grown to $63 billion (approximately Rs. 4,89,004 crore), up from $15 billion (about Rs. 1,16,431 crore) in 2020.
"You have to create a Taiwan in India," Agarwal said, adding that in order for India to become a global superpower, it will need to focus on bringing the full semiconductor ecosystem to the country.
The Indian government has announced that it will boost incentives for those investing in semiconductor production beyond a $10 billion (approximately Rs. 77,621 crore) plan, as it aspires to become a major role in the global chip supply chain.
