According to Reuters reported on May 31, three sources said that a consortium plans to spend $ 3 billion in India to build semiconductor facilities stalled, because the consortium was listed as a technical partner of the Israeli chip maker - Tal Semiconductor is being acquired by Intel Corporation. This stall has dashed India's chip manufacturing plans.


  According to the report, another direct informant said the second $19.5 billion plan to manufacture chips locally - built by a joint venture between India's Vedanta and Foxconn - is also slow, as they persuaded European chipmaker - STMicroelectronics Ltd. to join the stalled negotiations.


  The challenges faced by these companies have caused serious setbacks for Indian Prime Minister Narendra Modi. Modi has made chip manufacturing a top priority, hoping to "usher in a new era of electronics manufacturing" by attracting global companies.

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  India reportedly expects its semiconductor market to be worth $63 billion by 2026. Last year, the country received three applications to build factories under a $10 billion incentive program. They came from the Vedanta-Foxconn joint venture, the multinational consortium ISMC, which considers Thar Semiconductor as a technology partner, and Singapore-based IGSS Ventures.


  The Vedanta joint venture's plant will be built in Modi's home state of Gujarat, while ISMC and IGSS have each committed $3 billion to build plants in two different southern states.


  ISMC's plan for a $3 billion chip plant is currently on hold because, following Intel's $5.4 billion acquisition of Thar last year, Thar cannot proceed with a binding agreement as the situation remains under review, the report said, adding that three sources with direct knowledge of the strategy said. The acquisition deal is awaiting approval from regulators.


  Talking about India's semiconductor ambitions, Indian Minister of State for Electronics and Information Technology Rajiv Chandrasekhar said in a May 19 interview with Reuters that ISMC "could not move forward" because of Intel's acquisition of Thar, while IGSS "wants to resubmit (the application) ". He said, "the two companies had to withdraw," but did not elaborate.

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  The report said two of the aforementioned sources said Thar may reassess the possibility of participating in the aforementioned joint venture based on the outcome of negotiations with Intel Corp.


  Next Track Investments, ISMC's partner, reportedly did not respond to a request for comment, and Thal declined to comment. Intel Corp. also declined to comment.


  IGSS did not respond, nor did India's information technology department.


  STMicroelectronics Ltd. also declined to comment.


  David Reid, chief executive of the Vedanta-Foxconn joint venture, said in a statement that they had reached an agreement with a technology partner to transfer the technology, but declined to comment further.