Vedanta seeks free land, cheap water and electricity in race to become India’s top chipmaker: report

NEW DELHI : In a race to become India’s top chipmaker, Vedanta Ltd is seeking 1,000 acres (405 hectares) of free land from states and other incentives for its $20 billion foray into chip manufacturing. -drivers and screens, sources told Reuters.

The oil-metals conglomerate said in February it would diversify into chipmaking and announced plans to form a joint venture with Taiwan’s Foxconn to support Prime Minister Narendra Modi’s plans to make India a center semiconductor manufacturing.

Although Vedanta is seeking federal incentives under a Modi program offering tax support, it is separately asking states for 1,000 acres of land at no cost on a 99-year lease, according to two sources with direct knowledge.

He needs 700 acres for his own facilities and the rest for accessories.

Vedanta has told state governments that its operations will help them generate $2.2 billion in tax revenue over 20 years and create up to 100,000 direct and indirect jobs, the first source said.

The company is in an advanced stage of considering proposals from at least three Indian states, Telangana and Karnataka in the south, and Maharashtra in the west, the source added.

Vedanta did not respond to a request for comment. Representatives from the tri-state IT and industries department did not immediately respond.

More and more companies and nation states, including India, are looking for ways to have seamless access to chips, which are at the heart of many critical future technologies such as artificial intelligence and 5G. .

Most of the global chip production is limited to a few countries like Taiwan and the United States. India, although a latecomer, is now actively attracting business, saying in December that it wanted to “augurate a new era in electronics manufacturing”.

From $15 billion in 2020, India’s semiconductor market is expected to reach $63 billion by 2026, according to the government.

Chip factories usually consume electricity and water in large quantities and their erratic supplies often concern the industry in India.

As part of lobbying states, Vedanta is asking for water and electricity at preferential and fixed prices for a period of 20 years, the sources said.

The first source added that Vedanta expects its factories to eventually consume around 40 million liters of water per day. This would be roughly the amount of water needed for a city of over 300,000 people, according to the suggested benchmark for urban water supply by the Government of India.

Separately, while Modi’s federal program could offer financial support of 50% of the project’s capital expenditure, Vedanta is seeking additional incentives from states, the source said.

India, hoping to attract more global space investment, will host a three-day semiconductor conference from Friday at its technology center in south Bengaluru which Modi will inaugurate.

Singapore’s IGSS Ventures and ISMC, a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel’s Tower Semiconductor, have also applied for federal incentives under Modi’s scheme.

To subscribe to Mint Bulletins

* Enter a valid email

* Thank you for subscribing to our newsletter.

Check Also

Governor Edwards and economic development officials to travel to the Netherlands and France to further develop water management and economic partnerships

BATON ROUGE, The. – This Friday, Governor John Bel Edwards will lead a delegation of …