Indian conglomerate Adani Group has paused negotiations with Israel’s Tower Semiconductor for a proposed 10 billion USD semiconductor manufacturing project in Maharashtra. The decision stems from concerns over the project’s strategic and commercial viability, particularly due to uncertainties surrounding demand for chips in India.
Back in September 2024, the plan was to build a shiny new chip factory in Taloja, Panvel, pumping out 80,000 wafers a month and creating 5,000 jobs. It was a key piece of India’s big push to join the global chipmaking club, backed by Prime Minister Narendra Modi’s “Make in India” cheerleading. But after some serious number-crunching, Adani’s team started fretting that the demand for chips might not be there, so they’ve slammed the pause button on talks with Tower.
Tower Semiconductor, a pro at making chips for cars and gadgets, was supposed to be Adani’s wingman. This hiccup hurts India’s chipmaking hopes, especially since the country still doesn’t have a single chip factory up and running. Other big dreams, like the 19.5 billion USD Vedanta-Foxconn deal that crashed and burned in 2023, have also tripped over stuff like slow government support and crazy-high costs. Right now, Tata Group’s 11 billion USD chip plant and Micron’s 2.7 billion USD packaging project are in the works, but they’re not exactly smooth sailing either.
India’s chip market is set to explode to 63 billion USD by 2026, with everyone from phone makers to car companies and the military needing chips. But starting a chip industry from zero is a wild ride, super expensive and with tough global rivals. The Adani-Tower project’s got Maharashtra’s thumbs-up, but it’s still waiting for the central government’s India Semiconductor Mission to sign off.
We use cookies to ensure you get the best experience on our website. Read more...