New Delhi:- Taiwan's Foxconn announced on Monday that it is pulling back from a $19.5 billion semiconductor joint venture with Indian metals and oil conglomerate Vedanta, backing Prime Minister Narendra Modi's plan to manufacture semiconductors for India.

Foxconn and Vedanta, the world's largest contract electronics makers, signed an agreement last year to set up a semiconductor and display manufacturing facility in Modi's home state of Gujarat.

"Foxconn has decided not to proceed with the joint venture with Vedanta," Foxconn said in a statement, without explaining why.   

Also Read:- Hyundai Launches EXTER Micro-SUV in India, Starting at Rs. 6 Lakh

The company has worked with Vedanta for over a year to "turn great semiconductor ideas into reality" before dissolving the joint venture and removing its name from the company, now wholly owned by Possession of the Company. said they mutually decided to It is Vedanta.

Vedanta and India's Ministry of IT did not respond to requests for comment.

Prime Minister Modi has made chip manufacturing a top priority in India's economic strategy to usher in a "new era" of electronics manufacturing, and Foxconn's move will attract foreign investors to manufacture chips domestically for the first time. It means that the company's ambition to attract is a setback. 

"The failure of this deal is definitely a setback in the 'Make in India' policy," said Neil Shah, vice president of research at Counterpoint. It will raise eyebrows for fundraising,” he added Doubt”.

Also Read:- Taiwan Scrambles Jets in Response to Sighting of Russian Warship

Foxconn is best known for assembling iPhone models and other Apple products, but in recent years it has branched out into chips to diversify its business.

Most of the world's chip production is confined to a few countries such as Taiwan, with India being a latecomer. Vedanta-Foxconn announced plans to manufacture semiconductors in Gujarat last September, and Prime Minister Modi called the project a "significant step" in boosting India's semiconductor manufacturing ambitions. 

But his plan did not come to fruition. Among the problems faced by the Vedanta-Foxconn project were deadlocked negotiations over including European chipmaker STMicroelectronics as a technology partner, Reuters previously reported.

Vedanta-Foxconn managed to get STMicro to license the technology, but the Indian government made it clear that it wanted to give more 'stakes' to European companies, including by participating in partnerships. STMicro showed no interest and talks were left up in the air, according to people familiar with the matter. 

Also Read:- Taiwan Tech Giants to Disregard China and Setup in India for Global Appearance

The Indian government said it remained confident in attracting investors to semiconductor manufacturing. Micron announced last month that it would invest up to $825 million (about 6.816 billion) in chip testing and packaging rather than manufacturing. The total investment will be USD 2.75 billion (approx.

India expects its semiconductor market to be worth US$63 billion (approximately Rs 5,20522 crore) by 2026, with three applications last year to build factories under its Rs 10 billion stimulus package received.

These were provided by joint venture Vedanta-Foxconn, Singapore-based IGSS Ventures, and global consortium ISMC, which includes technology partner Tower Semiconductor. A $3 billion ISMC project was also stalled by Intel's acquisition of Tower, and another $3 billion plan by IGSS was canceled after the company resubmitted its application. 

Also Read:- Google to Launch Its New Intense Chip With TSMC

Taiwan Tech Giant Foxconn is now coming to India by getting into collaboration with Vedanta the Indian metals-to-oils conglomerate for the production of semiconductors by getting in touch with Prime Minister Narendra Modi.