Government of India and Foxconn worried about the financial situation of VedantaThat led the Taiwanese company to split with Vedanta over the chipmaking joint venture, sources familiar with the information told Reuters.
Vedanta Resources, the London-based parent company of Indian conglomerate Vedanta, is grappling with a mounting debt burden.
In a statement to Reuters, Vedanta said its Indian unit, Vedanta, is in a “comfortable financial position” and there is “no basis” for such speculation.
India’s IT ministry did not respond to requests for comment on Tuesday.
Some rating agencies downgraded Vedanta Resources this year amid concerns about the risks of debt default.
Vedanta Chairman Anil Agarwal has said that there has been no loan default on the part of the group.
Meanwhile, Foxconn Said The company plans to apply for incentives offered by India under its semiconductor manufacturing policy on Tuesday, a day after partnering with Vedanta on a $19.5 billion (roughly Rs. 1,60,600 crore) chipmaking joint venture.
“Foxconn remains committed to India and sees the country successfully establishing a strong semiconductor manufacturing ecosystem,” the company said.
“Foxconn is working towards submitting an application.”
On Monday, Foxconn pulled out of its semiconductor joint venture with Indian metals-to-oil group Vedanta, dealing a blow to Prime Minister Narendra Modi’s chip manufacturing plans for India.
Foxconn said on Tuesday, without sharing details, that there was “a recognition on both sides that the project was not moving fast enough” and that there were other “challenging shortfalls that we simply were not able to overcome”.
“This is not a negative,” Foxconn said in a statement.
© Thomson Reuters 2023
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