Foxconn Partners with HCL Group to Set up Semiconductor Assembly and Testing Facility in India

Taiwan-based Foxconn has tied up with technology firm HCL Group to set up a semiconductor assembly and testing facility in India as part of its strategy in enhancing semiconductor manufacturing capabilities.
Foxconn at a trade showThe joint venture, unveiled on Thursday, will see the creation of an outsourced assembly and testing (OSAT) unit in the South Asian nation.

Foxconn did not reveal its investment plans for the purpose.

An OSAT plant is integral to the semiconductor production process, involving the packaging, assembly, and testing of foundry-made silicon wafers, ultimately transforming them into finalized semiconductor chips, Reuters news report said.

According to a regulatory filing by Foxconn, its India unit is set to possess a 40 percent stake in the joint venture, backed by a substantial $37.2 million investment. Financial details from HCL Group’s side were not disclosed in the announcement.

In a joint statement, the partnering companies emphasized that the investment aims to establish a robust ecosystem and bolster supply chain resilience for the domestic industry. The precise location of the proposed project, however, was not disclosed in the announcement.

In addition to the OSAT unit, Foxconn is exploring the establishment of a semiconductor fabrication plant in India. This move aligns with the Indian government’s incentive program, which offers $10 billion to encourage local chip manufacturing initiatives.

It’s worth noting that Foxconn faced challenges in its semiconductor venture in India last year, marked by a high-profile split with local business house Vedanta in a $19.5 billion chipmaking joint venture. Despite this setback, the company remains committed to expanding its semiconductor footprint in the rapidly growing Indian market.

Foxconn, one of the main suppliers to Apple, is aiming to make an investment of an additional $1.67 billion in India’s Karnataka state. Foxconn assembles around 70 percent of iPhones and is the world’s largest contract manufacturer.