For the construction of the semiconductor plants, Gujarat provided Vedanta with both financial and non-financial subsidies, such as low-cost electricity. Now, Vedanta is set to build a $20 billion semiconductor plant in Gujarat.
According to two sources 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, reports mint.
According to the first source with information on the situation, Vedanta received financial and non-financial subsidies, such as capital expenditure and affordable electricity from Gujarat, to construct the semiconductor plants.
The source added, declining to be identified before an official declaration, that the venture will include display and semiconductor facilities close to Ahmedabad, the state’s largest city.
According to a Reuters report from April, Vedanta had lobbied for incentives including 1,000 acres (405 hectares) of free land on a 99-year lease as well as water and power at fixed, discounted rates for 20 years.
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A official signing of a memorandum of understanding between the two parties is anticipated this week, with Patel and Vedanta officials slated to attend, according to the source.
Other areas in the running for the Vedanta-Foxconn megaproject included India’s wealthiest state of Maharashtra in the west and Telangana and Karnataka in the south.
However in the most recent round of negotiations, Gujarat edged out Maharashtra.
According to the government, the Indian semiconductor market will 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 participant, is now consciously courting businesses to “usher in a new era in electronics manufacturing” as it looks for ways to have easy access to chips.
Oil-to-metals conglomerate Vedanta made the decision to expand into chip manufacturing and establish the joint venture with Foxconn in February.