After failing to get a technology partner to make 28-nanometer chips, Vedanta-Foxconn JV has submitted a revised application for making less complex and cheaper 40-nanometer chips.
“We have submitted the application as per the revised guidelines. We are committed to building a world-class fab in India,” Vedanta Foxconn JV said in a statement on Tuesday, without disclosing any further details about the project.
The revised application by the JV company comes after the government last month re-opened the application window for the 76,000-crore semiconductor manufacturing incentive scheme. The three companies — Vedanta-Foxconn joint venture, Singapore-based IGSS Ventures and ISMC consortium – had applied under the scheme in February 2022, when the government had opened the application window for 45 days. However, all the applications failed to get approval from the government.
This time, the window will remain open till December 2024.
The 28-nanometer chips are thinner and considered superior, as devices in which they are used can be packed with more features. In comparison, 40-nanometer chips are thicker and demand for these is expected to be less. Analysts said the technology has become so advanced that currently even 4-nanometer chips are being produced. While the 40-nanometer chips require less capital outlay, analysts said such plants may have problems in getting global orders and scaling up.
“We are fully equipped to make semiconductors. We have already selected a site in Gujarat, and the government is with us shoulder to shoulder,” Anil Agarwal, non-executive chairman of Vedanta Group, had said last month in the town hall address to shareholders.
Last week, US-based Micron Technology announced its plans to set up a $2.75-billion chip packaging (assembly, testing, marking, packaging) unit in the country. Post the announcement, communications and IT minister Ashwini Vaishnaw said the first made-in-India chip under the project will be rolled out by December 2024, and annual production worth $1 billion is expected once the plant is fully operational.
He also said that six more semiconductor projects will come up in the next one year.
“We want to become the capital of the semiconductor industry. India has talent, cost advantage and the market is growing,” Vaishnaw told Fe, adding that the semiconductor industry globally will touch $1 trillion from $650 billion.
In the first round of applications, Vedanta-Foxconn JV, IGSS Ventures and ISMC (a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel’s Tower Semiconductor) had proposed to set up chip-making plants with $13.6-billion investment and had sought support of $5.6 billion from the government under the incentive scheme.
In September 2022, the government had also made modifications in the semiconductor scheme by making the fiscal support of 50% of project cost uniform across all technology nodes for setting up of semiconductor fabs.