A consolation reward for the unsuccessful Vedanta-Foxconn deal? Modi “promises an even greater project for Maharashtra”

Prime Minister Narendra Modi “promised” Maharashtra a “equally strong or even greater investment” as compensation for missing out on a $22 billion Vedanta-Foxconn semiconductor facility, a multi-crore investment opportunity.

State Industries Minister Uday Samant stated that Modi had made the commitment to Chief Minister Eknath Shinde over the phone on Tuesday while speaking to a press conference at Mantralaya, the seat of the Maharashtra government, in Mumbai.

“Just yesterday, the CM spoke to the PM over the phone and discussed this project. The PM also said that perhaps this situation arose because the industrialist did not get the expected response over the past few months,” Samant said.

He added that the prime minister had “promised the people of Maharashtra that, in the coming few days, an equally strong or even better investment will come to Maharashtra…the PM is someone who sticks to his word”.

Samant added that Maharashtra’s incentive package, worth Rs 38,831 crore and approved by the Shinde-led government in July for the Vedanta-Foxconn partnership, was “better” to those made by other states.

The offer includes a power tariff subsidy of Rs 1 per unit in addition to a capital subsidy of up to 30% for building the plant at Talegaon Industrial Area, among other incentives.

According to Samant, the state administration would ask Indian mining firm Vedanta Group and Taiwanese manufacturing behemoth Foxconn why they still selected Gujarat.

A Memorandum of Understanding (MoU) for a 1.5 lakh crore joint venture to build a semiconductor manufacturing and display production plant was inked by Vedanta-Foxconn and the Gujarat government on Tuesday.

The Maharashtra government, which had lobbied for the Hon Hai Precision Industry Co. Ltd. plant—also known as Foxconn—for seven years—found the agreement to be a setback.

Additionally, the MoU set off a political blame game between the Bharatiya Janata Party (BJP) and the Sena side led by Eknath Shinde and the Maha Vikas Aghadi (MVA) alliance, which includes the Shiv Sena, the Nationalist Congress Party (NCP), and the Congress.

“MVA did not complete the bundle”
Shiv Sena MLA Aaditya Thackeray blasted the Shinde-led administration for allowing the multi-crore investment slip away, claiming that the earlier MVA administration had finalised 95% of the contract and that just paperwork remained to be completed.

Samant, however, informed the media that the Vedanta-Foxconn joint venture was not technically, on paper, granted any incentive package by the former Uddhav Thackeray administration.

“On 5 January 2022, they [Vedanta-Foxconn] sent a letter to the Centre with a copy to the state [Maharashtra] saying we want to set up this investment and are looking at four states, including Maharashtra, and asked what package will you give us.

“The people who are criticising us had six months to finalise things,” Samant said, defending CM Shinde who assumed office on 30 June.

Samant further added that “there were only meetings [between government officials and Vedanta-Foxconn] in these six months, here and outside the country”.

“But these people were working with the assumption that this company is not going to come to Maharashtra,” he said, taking aim at the MVA coalition.

Samant added that Deputy CM Devendra Fadnavis met with Anil Agarwal, chairman of Vedanta Resources, to reaffirm Maharashtra’s commitment to the project, and that Shinde had instructed industries department staff to present the finest package after entering office as chief minister.

“On this, he [Fadnavis] was told if you want that, till date you have not given us an incentive package, till date you haven’t finalised an MoU. There have only been discussions,” Samant said.

A high-power committee of the state government convened following this meeting, he continued, and on July 15 officially approved a package worth Rs 38,831 crore for Vedanta-Foxconn that included concessions on land, energy, water, and other resources.

“They had given us a letter saying they are interested, and just eight days ago, the industries department had sent them a letter about going ahead with the project in Maharashtra,” said Samant.

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