Foxconn, Apple's key iPhone assembler and supplier with major operations in China, has pulled out of a $19.5 billion semiconductor joint venture deal with Indian conglomerate Vedanta.
The JV project to produce semiconductor and display components in Gujrat, the home state of Indian Prime Minister Narendra Modi, was signed in September last year. Foxconn reportedly said the decision to withdraw from the deal was by mutual agreement.
Meanwhile, Foxconn said it remained confident about India's semiconductor ambitions and is in talks with several Indian and international partners to move forward with the plans to make semiconductors in the country.
While announcing the deal last year, Foxconn and Vedanta had agreed to invest nearly $20 billion in Gujrat to set up semiconductor and display production plants. Foxconn was to bring technical expertise to the venture, while Vedanta agreed to finance the project.
Vedanta had agreed to setup a display manufacturing unit with an investment of $11.95 billion and separate chip-related production units by investing $7.58 billion. The Vedanta-Foxconn joint venture project, which aimed to start manufacturing display and chip products within two years, was also expected to create more than 100,000 jobs in Gujarat.
The Taiwanese firm, which is moving some supply chains out of China amid increased tensions between the US and China, has already started building multiple factory sites across India, including one in Telangana and another in Karnataka state.
Foxconn recently announced plans to venture into making of electric vehicles, saying that it considers electric vehicles as the next growth targets. According to reports, the company was also considering setting up an EV manufacturing plant in India.
The company already manufactures iPhones at its Sriperumbudur factory on the outskirts of Chennai, India.
Foxconn operates the world's biggest iPhone factory in the Zhengzhou city, called iPhone City. The major plant was hit hard last year by worker unrest following Covid-19 spread and related restrictions.
In late June, Foxconn and automotive company Stellantis N.V. said they have formed a 50/50 joint venture named SiliconAuto, to design and sell semiconductors for the automotive industry, including Stellantis, starting in 2026.
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