Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), is teaming up with STMicroelectronics NV for a bid to build a semiconductor factory in India, seeking state backing to broaden its footprint in the South Asian country.
Hon Hai and French-Italian STMicro are applying for state support from India for a 40-nanometer chip plant, people familiar with the matter said, asking not to be identified. Such mature chips are used in cars, cameras, printers and in a wide variety of other machines.
The move comes after Hon Hai’s attempted partnership with billionaire Anil Agarwal’s Vedanta Resources Ltd fell apart after a year of little progress. By partnering with STMicro, the Taiwanese electronics maker is working with a chip-industry pioneer to expand in the lucrative-but-difficult semiconductor business.
Photo:Reuters
However, neither Hon Hai or Vedanta have significant experience in chipmaking. Furthermore, their joint venture was thwarted by delays in finding a partner with production-ready chip technology and obtaining approvals for state subsidies.
New Delhi has asked Hon Hai, Apple Inc’s key assembly partner, for more details about its partnership with STMicro, the people said. Hon Hai is also in talks with other companies that have chip-making technology, one insider said.
Indian Prime Minister Narendra Modi has pledged US$10 billion to woo global chipmakers, promising his administration would cover half the cost of setting up semiconductor sites. That effort has prompted US memorychip firm Micron Technology Inc to announce a US$2.75 billion assembly and testing facility in Modi’s home state of Gujarat.
Other chip-related firms moving into India include Advanced Micro Devices Inc and equipment maker Applied Materials Inc, which plan to spend US$400 million each on R&D and engineering centers in the southern tech hub of Bengaluru.
The Indian Ministry of Electronics and Information Technology did not respond to a request for comment. Hon Hai and STMicro spokespersons declined to comment.
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