HTLS 2022: World wants India to remain a market, says Vedanta chairman

The world wants India to remain a market and not become a manufacturer, the chairman of mining conglomerate Vedanta said on Saturday, as he outlined how a big ticket investment from Taiwanese equipment maker Foxconn will provide a significant boost for India in the sector.

Speaking at the 20th Hindustan Times Leadership Summit, Vedanta Resources Ltd’s chairman Anil Agarwal spoke on the company’s future plans, the challenges in the interim and how he sees the trajectory of India’s manufacturing sector.

“The world wants that India remains a market and not a manufacturer,” Agarwal told Sruthijith KK, editor-in-chief of Mint, during the conversation.

The tycoon spoke on the Foxconn semiconductor plant being set up in Gujarat. “A complete ecosystem has to be created. We are just making fundamental raw materials. Setting up (the plant) in Gujarat has its own challenges. As we move forward, more doors will open”, he said.

“If we get the fundamental product, then each state will be able to design their own products according to their needs”. He added that proven technologies like automobile technologies and some chips required for laptops will be provided within two years of laying the foundation stone.

The company this September announced a $20-billion ( ₹1.54 trillion) investment plan for its chip and display facility in Gujarat.

The investment plan, while being welcomed to transform the semiconductor manufacturing in the country, also drew controversy over the investment not coming up in Maharastra that first proposed to facilitate such investment.

Agarwal said the group was fully committed to investing in Maharashtra as well. “Maharashtra will set up one of the largest downstream which will be bigger than Gujarat. This will happen,” Agarwal said.

“We will soon create a hub where Maharashtra will be part of our forward integration.” He added that as the project progresses, new doors will open.

He however warned against the politicisation of the issue. “Please don’t make it a political issue. India is one and let us make the raw material. “Kuan khudega toh paani sabko milega” (When a well is dug, everyone will get water)”, he added.

Sharing the details about the mega semiconductor project with Foxconn, Vedanta’s boss said that the project aims to create a complete ecosystem by making fundamental raw materials and each state will be able to make its smartphones, TVs.

“Smartphones, electric vehicles, all need to come at an affordable price. A complete ecosystem has to be created. We are just making fundamental raw materials. If we get the fundamental product, then each state will be able to design their own products according to their needs,” Agarwal said.

Talking about the timeline of the opening of the semiconductor chip plant, Agarwal said that proven technologies like automobile technology and some of the chips required for laptops will be provided within two years of laying the foundation stone.

Agarwal mentioned that “$73 out of $100 goes into importing products” and the “world wants that India remains a market and not a manufacturer.”

When asked about what changes he has seen in terms of desire to facilitate business, bring in industry, and chase for complex projects like these, Agarwal said, “The trust deficit has narrowed.”

Prime Minister Narendra Modi has gained more popularity among the people of the country due to the trust he built during the Covid-19 pandemic, the Vedanta chairman said.

Agarwal added that artificial intelligence (AI) and digital technologies are the need of the hour while talking about the overall impact on the electronics manufacturing ecosystem. Citing a report, he said 50% of the businesses that do not involve digital technologies will shut down.