India’s recent surge in the top five biggest economies in the world is no joke. Economists estimate that India will be just behind US and Canada by 2030, outdoing the United Kingdom. Now to add to the growing legacy of the Indian economy, there soon seems to occur a technological revolution beginning at the foundational level. Vedanta – the Mumbai-based Multinational Mining corporate is hell-bent on seeing the Indian electronics market flourish.
Together with Electronic Manufacturing giant Foxconn from Taiwan, Vedanta is all set for establishing a semiconductor ecology in India. Vedanta and Foxconn in its joint gesture will invest over 1.6 Lakh crore into building what should become India’s chip factory revolution.
Vedanta Foxconn Joint Operative
- After Vedanta chairman Anil Agarwal said in an interview with CNBC TV18 that Maharashtra will become the hub for Apple iPhone manufacturing and other electronics, their shares stood up at a rising 2.81%.
- The Mining conglomerate and the leading Electronic Manufacturing giant, Vedanta and Foxconn will jointly bring together 28 nanometers technology nodes with 300 mm wafer size; and a Gen 8 display manufacturing. The new chip factory in India is only on its path of initiation in the journey of completion.
The Shares in The Project
- The mining magnate Vedanta will hold 60% stakes while Foxconn is said to own 38 percent of the equity and has 40% stakes.
The Investment In India’s Chip Factory
- “There is not a single institution that does not want to fund us. Foxconn will own 38 percent of the equity and will thus bring in the money. Money will never be a constraint,” Anil Agarwal in an interview.
- The entire project has a total investment of over 1.54 Lakh crore. India’s New Chip factory should come up within two years. Of the proposed investment, Rs 94,500 crore will be invested in the display fabrication unit and the rest in Semiconductor fabrication.
A step towards realising PM @narendramodi Ji’s vision to establish India as a trusted partner in global semiconductor supply chain. Vedanta-Foxconn inked MoU with Gujarat for setting up semiconductor & display fab for ₹1.54 lakh crore and generate 1 lakh direct employment. pic.twitter.com/JE8A3uiDA8
— Ashwini Vaishnaw (@AshwiniVaishnaw) September 13, 2022
What is The Semiconductor Ecology- India’s First Chip Market About?
Simply put, this new operative by Vedanta-Foxconn will have two units. One would be a display manufacturing unit and the other a semiconductor fabrication unit. The latter will be a joint unit consisting of one fabrication and one outsourced semiconductor assembly and testing unit.
The display manufacturer will put out Gen 8 displays. These usually can cater to a variety of small to medium & large applications (displays in phones, monitors, tv, etc).
What India’s First Chip Factory Means For Consumers
- The primary reason why India’s electronic market is weighed heavily with the cost is due to one reason: lack of manufacturing and overseas import taxation. The thing about the Indian economy is that the Electronic market is still considered a luxury. There is no manufacturing happening in India.
- The Semiconductor industry will change the scape of the electronic market forever. Usually, when one buys an Electronic item, the item is manufactured outside India but imported. Hence the taxation on it is considerably huge. The end result is that the electronics market become a relatively higher-priced market. One would find that electronics in the majority of Western nations cost much less. Even Asian countries such as Korea and Japan has a flourishing Electronics front.
Consumers will see the reflection of this process in the way prices should drop in the Electronics market. “Today, a laptop costs Rs 1 lakh, and once the glass, as well as the semiconductor chip, are available, the same can be priced at Rs 40,000 or less,” said the Vedanta chairman to a renowned news channel.
What will change is that the drop in price for Electronics will make them more easily available to the middle to lower middle-class segment of the population. In today’s age, technological upbringing is vital to a nation’s wealth. Jio’s initiative in providing the cheapest possible cellular networking service has already revolutionized the digital landscape of India.
This MoU is an important step accelerating India’s semi-conductor manufacturing ambitions. The investment of Rs 1.54 lakh crore will create a significant impact to boost economy and jobs. This will also create a huge ecosystem for ancillary industries and help our MSMEs. https://t.co/nrRbfKoetd
— Narendra Modi (@narendramodi) September 13, 2022
Concluding
Lately, there has been a race in the leading global electronics market to diversify supply chains and manufacturing throughout the world. The 2020 supply shortage was a blow to most of the leading electronic corporate conglomerates, but with India at the forefront of new manufacturing nations, there is much to benefit.
Although India should be the first to see these benefits, the world economy in itself will continue to flourish more with a regression slaught, but an expansion in growth.
Also Read: iPhone 14 is probably not worth the upgrade from iPhone 13
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