Zoho suspends $700 million India chipmaking plan
In June 2024, the Indian company had applied for government incentives under the India Semiconductor Mission (ISM) to build a compound semiconductor chip fabrication unit in Karnataka.
Indian software as a service (SaaS) company Zoho has suspended its USD 700 million plan to enter into chip manufacturing.
The government of the southern state of Karnataka had approved Zoho’s proposed chip fabrication facility in Mysuru region, the first such mega project in the state.
“On our semiconductor fab investment plan, since this business is so capital intensive it requires government backing, we wanted to be absolutely sure of the technology path before we take taxpayer money,” the company’s founder Sridhar Vembu said in a post on social media platform X. “We did not have that confidence in the tech so our board decided to shelve this idea for the time being, until we find a better tech approach.”
Zoho, which offers software and related services on subscription to businesses around the world, has more than 120 million users.
In June 2024, the Tamil Nadu-headquartered company had applied for government incentives under the India Semiconductor Mission (ISM) to build a compound semiconductor chip fabrication unit. Zoho had also formed a new entity, Silectric Semiconductor Manufacturing, for this purpose.
According to a Reuters report, India’s Adani Group has also paused discussions with Israeli company Tower Semiconductor for its USD 10 billion semiconductor project.
Tata Group’s Dholera semiconductor unit in Gujarat is reportedly the only chip fabrication facility in India approved by the central government so far, under the ambitious ISM. The facility is expected to start operations by 2027.