Indian billionaire Gautam Adani's group has paused discussions with Israel's Tower Semiconductor for a $10 billion chip project in India. Sources familiar with the matter indicated that the decision was made because the project did not make strategic and commercial sense for the Adani Group. This development marks a significant change for a venture that had previously received state approval.
Adani's internal evaluation found uncertainty about how much demand, particularly within India, the business could generate. Additionally, Tower Semiconductor was expected to contribute technological expertise, but the Adani Group reportedly desired more financial investment from Tower. These factors contributed to the decision to put the talks on hold.
The Maharashtra state government had previously announced approval for the Adani-Tower venture in September, with expectations for it to produce 80,000 wafers per month and create 5,000 jobs. This project was aligned with Prime Minister Narendra Modi's ambition to establish India as a chipmaking hub. The pause in discussions represents a setback for this specific initiative.
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