The Union Cabinet has approved a joint venture between HCL and Foxconn to set up a chip assembly and packaging unit in Uttar Pradesh, making it the sixth project to receive approval under the government’s ambitious Rs 76,000 crore India Semiconductor Mission.

The plant will attract an investment of Rs 3,706 crore, with around Rs 1,500 crore coming from the government’s kitty as part of incentives under the chip manufacturing scheme. This plant will manufacture display driver chips for mobile phones, laptops, automobiles, PCs, and other devices which include a display. The facility will be designed for 20,000 wafers per month, and will have an output capacity of 36 million units each month.

This is Foxconn’s second attempt at making a foray into India’s local chip production push. In 2022, the company had applied for a semiconductor manufacturing plant along with Vedanta, however, that joint venture fell apart a year later in 2023 after the two could not find a viable technology partner.

The plant will be set up near Jewar airport at the Yamuna Expressway Industrial Development Authority in Uttar Pradesh. This is the first chip plant that will come up in the state under the centre’s India Semiconductor Mission. Four plants – including a fab and three assembly units – are coming up in Gujarat and one assembly and packaging plant is under construction in Assam.