ISMC’s India chip plan stalls after Tower-Intel deal in setback to Modi

A planned $3 billion semiconductor facility in India by chip consortium ISMC that counted Israeli chipmaker Tower as a tech partner has been stalled due to the company’s ongoing takeover by Intel, three sources said, dashing India’s chip making plans.

A second mega $19.5 billion plan to build chips locally by a joint venture between India’s Vedanta and Taiwan’s Foxconn is also proceeding slowly as their talks to rope in European chipmaker STMicroelectronics as a partner are deadlocked, a fourth source with direct knowledge said.

The challenges faced by the companies deal a major setback to Prime Minister Narendra Modi, who has made chipmaking a top priority as he wants to “usher in a new era in electronics manufacturing” by luring global companies.