India has previously questioned the chip project jointly ventured between Foxconn and the Indian local company Vedanta, believing that it does not meet the rules of Indian chip subsidies, but recently India has asked them to reapply, giving them hope, which has troubled Foxconn's chip dream.
It is said that Foxconn and Vedanta plan to build a chip manufacturing project of $19.5 billion, while the project is targeting a $10 billion subsidy from India, which means that Foxconn and Vedanta are expected to complete the construction of the chip factory with only half of the money they make.
Foxconn and Vedanta plan to build a chip factory with a 28nm process, do such factories really need $19.5 billion? Chinese mainland the largest chip company SMIC, is promoting four 28 factories, with a total investment of 170 billion yuan, about less than 24 billion US dollars, it can be seen that the joint venture between Foxconn and Vedanta seems to need far more capital than SMIC's four factories.
In fact, this operation has always been Foxconn's habit, in the Chinese mainland, Foxconn every investment often requires the local to provide preferential land and complete the relevant infrastructure construction, provide huge loans, but also tax incentives, etc., so Foxconn has always been suspected of having empty gloves white wolf, but because Foxconn factories can provide huge employment opportunities locally, many Chinese mainland provinces and cities have also accepted Foxconn's harsh conditions.
However, India is also a master of playing empty gloves white wolf, before many foreign-funded companies such as Nokia, Chinese mobile phone companies, Wistron and other investment in India, India forced Nokia on the grounds of taxes and fees, Wistron has been acquired by an Indian consortium, and now Chinese mobile phone companies have been confiscated by India 5 billion yuan, all show that India is quite skilled in playing this method.
It makes sense that India and Foxconn manipulate each other. India hopes to borrow the hand of Foxconn to help India develop the chip industry; Foxconn hopes to use India's chip subsidies, land and other resources to enter the chip industry, but both are unwilling to invest real money, which should be the reason why Foxconn and Vedanta chip projects in India are difficult to advance.
The other is that neither Foxconn nor Vedanta have any chip technology, and their original consideration was to obtain a chip technology license from STMicroelectronics, but ST did not have any investment income from the project, nor did it see real money, so ST expressed no interest, which made it difficult for Foxconn and Vedanta to obtain chip technology.
In the face of Foxconn, the old fox, India now gives hope, in the chip manufacturing project prepared by another Indian company may die, another Indian company was originally with an Israeli chip company to cooperate and obtain technology, but with Intel's acquisition of the Israeli chip company, the project has been difficult to advance, India hopes to obtain chip technology, so even if Foxconn's side is quite slim, India is still willing to advance.
Foxconn's concern is that Wistron was acquired by an Indian consortium, Wistron has only 10,000 employees in India for more than two years, but such a small factory is quickly targeted by the Indian consortium, in contrast to Wistron in Chinese mainland had 80,000 employees, Foxconn had 1.3 million employees at the peak of Chinese mainland but still had control, which made Foxconn worry that its investment in India ended up empty, and made it hesitate to develop chip projects in India.
It can be said that although India has hung tens of billions of dollars of chip subsidies, but India may not be willing to pay real money, Foxconn does not want to invest heavily and finally get nothing, all parties intend to disc, India's chip project has been swinging, just like a castle in the air, becoming a joke in the global chip industry.