Foxconn-Vedanta opens India’s first semiconductor factory in Dholera

A joint venture by Indian conglomerate Vedanta and electronics giant Foxconn has completed the Dholera Special Investment Region near Gujarat city of Ahmedabad for the construction of its semiconductor and display manufacturing facility, a senior government official said Monday.

In the largest corporate investment to date in the history of independent India, a joint venture between Vedanta and Foxconn Signed a Memorandum of Understanding (MoU) with the Government of Gujarat in September last year to invest Rs. 1,54,000 crore to set up facility in state. This will be the first production facility for semiconductor in India.

At the time, the joint venture company had not disclosed the exact location of the facility.

“Following a detailed site analysis in consultation with the Gujarat government authorities, the joint venture company of Vedanta and Foxconn has awarded Dholera SIR for the establishment of its semiconductor and Advertisement Production facility. The project is at an advanced stage of evaluation by the Indian government,” the official said.

The MoU was signed in Gandhinagar in September last year in the presence of Minister of Railways, Communications, Electronics and Information Technology Ashwini Vaishnaw.

Both companies would invest Rs. 1.54,000 crore to set up the facility in Gujarat, which would create one lakh job opportunities, Gujarat Chief Minister Bhupendra Patel had said at the occasion. Patel had also said his government would work together to set up the facility and make it a success.

Remarkably, while speaking at a rally in Bhavnagar ahead of the general elections in November, Prime Minister Narendra Modi clearly indicated that the mega semiconductor fab would be built at Dholera SIR, nearly 100km from Ahmedabad.

This project is expected to receive huge subsidies and incentives under the “Gujarat Semiconductor Policy 2022-27” announced by the state government in July last year, such as:

Gujarat was the first state in the country to have such a committed policy for the semiconductor and display manufacturing sectors, a government official said earlier.

Under this policy, eligible projects receive a 75 percent subsidy on the purchase of the first 200 acres of land for the construction of production units. The eligible projects will receive good quality water at the price of Rs. 12 per cubic meter for the first five years.

Also, to encourage investors under the policy, the state government has announced that it will refund 100 percent of the stamp duty that investors would pay for the first-time lease, sale or transfer of land.