Another blow for India’s semiconductor ambitions, Zoho halts its $700 million chip dream, as tech doubts and lack of partners force a major rethink in Mysuru.
Indian software company Zoho has paused its $700 million semiconductor venture, co-founder Sridhar Vembu confirmed on Thursday. This follows earlier reports by Reuters, marking a major setback to India’s efforts to build a domestic chip manufacturing industry.
The decision comes after Zoho reportedly failed to secure a suitable technology partner to guide the complex chipmaking process. The company had planned a $400 million facility in Karnataka’s Mysuru region, which was expected to create 460 jobs.
Vembu acknowledged the project’s suspension in a social media post, saying the firm lacked confidence in the technology. He added that due to the high costs involved and reliance on public funding, Zoho wanted certainty before moving forward.
This week, Adani Group has also paused talks with Israel’s Tower Semiconductor over its $10 billion chip project, following an internal review. These announcements are likely to dent Prime Minister Narendra Modi’s push to make India a global chip hub. Currently, India does not have any operational semiconductor fabrication plants.
Founded in 1996, Zoho is a privately held firm valued at $12 billion. It offers cloud-based software solutions as cost-effective alternatives to products from companies like Microsoft. Zoho operates in 150 countries and serves over 120 million users, with more than 18,000 employees worldwide.
Last year, Zoho had launched Silectric Semiconductor Manufacturing and appointed a board, showing serious intent. The Karnataka government had approved the project in December, calling it a landmark initiative.
Officials from Karnataka, however, did not respond to Reuters’ request for comment. For now, Zoho’s chipmaking plans remain on hold, with no timeline for resumption.
