Foxconn, an Apple supplier, withdraws from $19.5 billion Indian semiconductor venture

In a blow to the Indian prime minister’s ambitions, Apple supplier and global manufacturing powerhouse, Foxconn, has decided to withdraw from a $19.5 billion joint venture project with an Indian conglomerate in the state of Gujarat. The collaboration aimed to establish semiconductor and display manufacturing facilities in India.

Responding to the development, Foxconn stated, “Foxconn has determined it will not proceed with the joint venture with Vedanta,” as reported by Reuters. This setback hampers India’s goal of becoming a leading high-tech manufacturing destination.

The increasing geopolitical and economic tensions have prompted American companies like Apple to urge their suppliers to diversify their supply chains beyond China. Although Foxconn has already initiated the construction of multiple factories in India, the proposed $20 billion joint venture with Vedanta was expected to be one of the largest.

The rupture of this partnership occurs against the backdrop of complex relations and delicate negotiations between the United States and China. Both sides strive to navigate their mutual dependence while simultaneously challenging one another. The U.S. government and major technology firms have started to openly recognize the Chinese technological advancements and manufacturing dominance as a significant national security threat. Consequently, many U.S. corporations are reassessing their operations in China as part of their risk management initiatives.

Despite this setback, Foxconn continues to pursue its expansion plans in India, including the construction of factories in Telangana and Bengaluru.