Adani to construct ₹83,947 crore semiconductor unit with Israeli firm in Maharashtra’s Taloja

The Adani Group will construct a semiconductor fabrication plant with its partner from Israel, aiming to boost India’s chipmaking capabilities.

The Adani Group and Israel’s Tower Semiconductor Ltd will build the chip manufacturing plant, according to a report by Bloomberg. 

The plant will be made with an investment of ₹83,947 crore ($10 bn) at Taloja on the outskirts of Mumbai, said Devendra Fadnavis, Deputy Chief Minister of Maharashtra, in a post on X.

Fadnavis said the plant will have a production capacity of 40,000 wafers in the first phase and 80,000 wafers in the second, providing 5,000 jobs.

The semiconductor plant is expected to be built in three to five years, according to the Bloomberg report citing sources. The Adani group will fund the investment through its internal funds and debt, it added.

The chips manufactured at the new semiconductor facility will be used in drones, cars, smartphones and other projects.

Semiconductors are a key industry amid a rising tech rivalry between the US and China, and India aims to manufacture semiconductor chips domestically rather than rely on imports.

This deal with Adani strengthens Tower Semiconductor's position in the Indian market and provides it a boost after its failed acquisition bid by Intel Corp, the report said. 

However, the sales of Tower Semiconductor are still far below those of industry giants Intel and Taiwan Manufacturing Co.

Tata's semiconductor plant

Earlier, the Tata Group partnered with Taiwan Semiconductor Manufacturing Corp to build a ₹91,000 crore ($11 billion) chip fabrication plant in Dholera, Gujarat.

The Tata Group’s Plant was expected to manufacture 50,000 mature chips using 40-nanometer or older technology, primarily for consumer electronics, automobiles, defence systems, and aircraft.

Earlier this year, the Indian government received proposals worth $21 billion to construct semiconductor capabilities, with more than $15 billion dedicated to chipmaking plants, the report said.

India has also established a $10 billion fund to attract chipmakers, leading US-based memory maker Micron Technology Inc, to build a $2.75 billion facility in Gujarat.