Another missed opportunity: How Maharashtra lost the Rs 1.54 lakh-crore Vedanta-Foxconn project to Gujarat

Vedanta and Taiwanese electronics giant Foxconn’s decision to set up a semiconductor and display manufacturing unit in Gujarat worth Rs 1,54,000 lakh-crore has caused outrage in Maharashtra. On Tuesday, oil-to-metals conglomerate Vedanta and Foxconn signed a Memorandum of Understanding with the Gujarat government to invest Rs 1,54,000 lakh-crore to set up a facility in the state. The oil-to-metals conglomerate said Vedanta Displays Limited will set up a Display Fab Unit with an investment of Rs 94,500 crore and Vedanta Semiconductors Limited will set up an integrated Semiconductor Fab Unit and OSAT (Outsourced Semiconductor Assembly and Test) facility with investment of Rs 60,000 crore. Also read: Aatmanirbhar Silicon Valley dreams to turn to reality: Why India’s first chip factory in Gujarat is reason to celebrate Chief Minister Bhupendra Patel, after the MoU was signed in the presence of Minister for Railways, Communications, Electronics & Information Technology Ashwini Vaishnaw at a function in Gandhinagar, said the move would create one lakh job opportunities. Gujarat Science and Technology Department Secretary Vijay Nehra, who signed the MoU on behalf of the state government, claimed this is the biggest-ever corporate investment in the history of independent India. “The investment of Rs 1.54 lakh-crore will create a significant impact to boost the economy and jobs. This will also create a huge ecosystem for ancillary industries and help our MSMEs,” Prime Minister Narendra Modi, congratulating the Gujarat government, tweeted. Vedanta chairman Anil Agarwal on Twitter thanked the Gujarat government and the Union IT Minister “who have helped Vedanta tie things up so quickly”. [caption id=“attachment_11245421” align=“alignnone” width=“640”] Anil Agarwal, founder and chairman of Vedanta Resources. ANI[/caption] “History gets made! Happy to announce that the new Vedanta-Foxconn semiconductor plant will be set up in Gujarat. Vedanta’s landmark investment of Rs 1.54 lakh-crore will help make India’s Atmanirbhar Silicon Valley a reality,” Agarwal tweeted, adding that the project will help the PM’s “vision of creating a robust manufacturing base in India”, and “reduce our electronics imports & provide 1 lakh direct skilled jobs to our people”. Meanwhile, in Maharashtra, an Uddhav Thackeray-led Shiv Sena has targetted the Shinde-led government. The Nationalist Congress Party has also accusing Gujarat of “snatching morsel from Maharashtra’s mouth” and MNS chief Raj Thackeray has demanded a probe. Let’s take a look at how Maharashtra yet again missed out on this opportunity, how history repeated itself and how the blame game has well and truly begun: How Maharashtra missed out Officials and politicians in Maharashtra are struggling to explain why the state missed out to Gujarat. In July, Chief Minister Eknath Shinde and his deputy Devendra Fadnavis met executives of the Anil Agarwal-led Vedanta Group and expressed optimism about the joint venture investing in Talegaon, as per The Print. As per Indian Express, talks with the Maharashtra government were ‘almost final’ when its senior officials met Shinde and  Fadnavis in July 2022. As per Financial Express, following the July meeting, Shinde claimed that Vedanta, along with Foxconn, could play “a pivotal role as the anchor investor in creating the next Silicon Valley”, while  Fadnavis said that Maharashtra was a “natural choice” for the semiconductor manufacturing plant. To the extent that officials from the state’s Industries department said company executives had finalised over 1,000 acres land in Talegaon Phase IV. The Maharashtra government offered among various incentives a capital subsidy of up to 30 per cent for setting up the plant at Talegaon. According to documents of the Industries department seen by Indian Express, the state government had offered an “extremely lucrative incentive package” as per the Electronics System Development and Maintenance and Fabrication policy of the state. The package included power tariff subsidy of Rs 1 per unit including support to Vedanta to set up a 750 MW captive solar power generation unit. [caption id=“attachment_11114901” align=“alignnone” width=“640”] Eknath Shinde and Devendra Fadnavis. News18 Hindi[/caption] The state also offered stamp duty waiver and exemption from electricity duty. The company was also offered incentives on employment generation, as per the report.

But it simply wasn’t enough.

Officials privy to negotiations said Maharashtra lost out to Gujarat due to a more lucrative offer on land-related incentives, as per Indian Express. History repeats itself This isn’t the first time Maharashtra has missed out. As per Business Today, the previous instance occurred in 1976 when the Central government decided to set up a semiconductor manufacturing facility with Navi Mumbai in the lead for the public sector Semiconductor Complex Ltd (SCL) facility. As per the report, a lot of groundwork had occurred with the project office even being set up in the iconic Air India building at Nariman Point. However, Maharashtra eventually lost out to Punjab due to the efforts of Giani Zail Singh, then chief minister of Punjab, who offered the SCL 51 acres of land for just Re 1. The SCL facility finally began in 1984, went up in flames and 1989 and restarted in 1997, but the catastrophe was a major setback to India’s ambitions, as per the report. Thackeray-led Sena targets Shinde-led govt The Eknath Shinde-led government backed by the BJP is under fire from the Uddhav Thackeray-led Shiv Sena. The Print quoted Subhash Desai, a senior leader from the Shiv Sena who was the MVA government’s industries minister, as saying he had several meetings with the executives of the company regarding their expectations from the Maharashtra government. “After all this, they selected a site in Talegaon. All these discussions were positive and the status was that only paperwork really remained. Then our government fell and we couldn’t take any more efforts to materialise the investment,” he said at a joint press conference with Aaditya Thackeray. [caption id=“attachment_9443081” align=“alignnone” width=“640”] File image of Aaditya Thackeray. News18[/caption] Desai added that Vedanta-Foxconn’s MoU with the Gujarat government was especially “unexpected” after seeing photos of Shinde and Fadnavis meeting Vedanta’s executives in July. Taking an aim at the Maharashtra chief minister, Aaditya claimed that the Maha Vikas Aghadi (MVA), when had “very strongly” pursued this project. It was almost decided that the plant will come up in Maharashtra, said Thackeray, who served as a cabinet minister in the former MVA government.

Congress leader and former minister Balasaheb Thorat also demanded to know what efforts the ruling government made to keep the project in the state, as per the report.

State NCP president and former minister Jayant Patil said with the project “slipping” away from the hands of Maharashtra, the state has lost an investment potential of ₹1 lakh-crore.

Sena MP Priyanka Chaturvedi slammed the state government.

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“MVA Industries Minister Sh. Subhash Desai ji & Environment Minister Sh Aaditya Thackeray had initiated the discussion upto the final stage. The government fell and the ‘ED’ sarkar claimed credit for it & used it for PR news in July. Now in September handed it over to Gujarat,” Chaturvedi tweeted. Meanwhile, Raj Thackeray demanded a probe into how Gujarat landed the deal. The MNS chief said Maharashtra losing out was a serious matter and not a good sign for investors. “We should go beyond politics and look at this issue,” the Maharashtra Navnirman Sena chief tweeted. Fadnavis, Samant blame MVA Speaking to The Print, Fadnavis said that the companies had decided to go ahead with investing Gujarat even before the Shinde-led government came to power, and that the blame lies with the earlier government.

Fadnavis claimed that the deal with the Gujarat government in the making for two years.

Fadnavis said the MVA government didn’t invite Vedanta-Foxconn executives for discussions even once despite the company being in talks with Gujarat for two years. “Our government came [back to power] just a few days ago. We were told that Gujarat has given a good deal to Foxconn Vedanta and they have decided to invest there. We immediately contacted them and offered a better package,” Fadnavis said. The BJP leader further said that his government had had negotiations with Vedanta-Foxconn but “finally, they decided to stick to their original decision to go to Gujarat”. “If at all we intend to start a blame game, then it is the previous government that is to blame…not even once did our erstwhile government invite them,” he said. “We tried our best, but we were late.” “Although I’m a little disappointed, I’m not discouraged. We’ll take Maharashtra much ahead of other states in the next two years,” he added. As per Financial Express, Maharashtra industries minister Uday Samant pointed the finger at the MVA regime. “Why didn’t the MVA government offer a better incentive package to the company?” he asked. With inputs from agencies Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.