India’s HCL Group and Taiwan’s Foxconn Group’s proposal to collectively construct a chip meeting unit within the nation shouldn’t be very passable, in keeping with the federal government, which has requested each firms to submit extra particulars in regards to the venture, mentioned folks in know of the developments.
The applying is at the moment being thought-about for incentives underneath the USD 10 billion Indian Semiconductor Mission, the folks instructed ET.
The extra particulars being sought embrace data on the know-how on which the outsourced meeting and testing (OSAT) unit will operate, the know-how associate for the enterprise and the kind of know-how switch settlement between the companions, mentioned the folks cited above.
“The 2 firms (HCL and Foxconn) might want to get a know-how associate. We’ve got additionally sought particulars in regards to the uptake of the output from the OSAT unit they’ve proposed,” mentioned a senior official from the ministry of electronics and data know-how.
This January, HCL and Foxconn introduced forming a JV to arrange an OSAT unit within the nation. On the time, folks within the know instructed ET that the overall funding within the unit may very well be between USD 100 million and USD 150 million.
Foxconn’s share within the three way partnership shall be USD 37.2 million for 40% stake via Foxconn Hon Hai Expertise India Mega Growth, a subsidiary of Hon Hai Applied sciences (Foxconn), the corporate knowledgeable inventory exchanges on the time.
HCL-Foxconn’s delay in securing approvals comes whilst Prime Minister Narendra Modi final week laid the muse stone for 3 semiconductor factories, one business chip fabrication unit and two meeting, testing, marking, and packaging (ATMP).
Whereas the chip fabrication unit is being constructed at Dholera in Gujarat by the Tata group and Taiwan’s PSMC, the 2 ATMP items are being constructed at Sanand in Gujarat and Morigaon in Assam, by the Tata group and CG Energy, respectively. The three items got approval on February 29.
An electronic mail despatched to Foxconn didn’t yield any response. A spokesperson from HCL mentioned the corporate will be capable of share particulars of the venture “at an acceptable time”.
The IT ministry’s queries to the HCL-Foxconn proposal marks a repeat of an earlier plan submitted by Foxconn, during which it had proposed to construct a chip manufacturing facility with Vedanta.
The sooner three way partnership, which was dissolved mutually final yr by the 2 companions, had additionally bought caught because of lack of readability over getting a know-how associate since neither had expertise in chip manufacturing.
“They (the three way partnership) will want a powerful technical associate. We’ve got permitted three thus far and all of the purposes had all the small print such because the sort of settlement between companions, and particulars of the consumption of chips produced at these factories. HCL and Foxconn will even want to inform us these,” mentioned one of many officers cited above.
In whole, India has 4 semiconductor chip manufacturing items underneath building. The whole capability of the three OSAT and ATMP items is more likely to be 80.5 million chips monthly, folks mentioned.
In December 2021, India made the primary effort in the direction of establishing a semiconductor manufacturing ecosystem within the nation, when it permitted a Rs 76,000 crore incentive plan for candidates.
Although the plan initially had a layered incentive construction for candidates primarily based on whether or not they utilized for chip manufacturing, OSAT or ATMP unit, it was later revised to provide a flat 50% central subsidy to profitable candidates primarily based on the fulfilment of goals.
