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The joint venture between Apple’s iPhone maker Foxconn and India’s multinational mining company Vedanta is over. The JV was supposed to establish semiconductor and display production plants in India, but Reuters reported that the two mutually decided to end the agreement.
The JV is reportedly part of Prime Minister Narendra Modi’s plan to give the Indian economy a boost through chipmaking. This should also aid Apple in shifting some of its iPhone production to India in the future. However, this could face some challenges, with Foxconn and Vedanta ending their $19.5 billion chip deal.
According to Reuters, the confirmation of the JV’s end was made by Foxconn, though it added that the two mutually agreed to the decision. The Taiwanese company didn’t specify the reason behind the decision, but the report cites a source claiming some factors that resulted in the end of the venture.
A source familiar with the matter said concerns about incentive approval delays by India’s government had contributed to Foxconn’s decision to pull out of the venture. New Delhi had also raised several questions on the cost estimates provided to request incentives from the government, the source added.
Despite the bad news, Vedanta underlined its commitment to its semiconductor project, adding it “lined up other partners to set up India’s first foundry” and “has redoubled its efforts” to make Modi’s plan possible. If this is brought to life, it should also benefit Apple, which plans to give India a bigger role in its iPhone production business. Currently, the Cupertino company primarily relies on Chinese factories for iPhone manufacturing. But it should change in the future, as recent reports claim Apple plans to bump India’s current 7% iPhone global production to 18% in the next two years or by 2025.
