In the United States, Brookfield has invested $15 billion in a joint venture with Intel Corp. to build a semiconductor manufacturing plant in Arizona. While Brookfield’s plan to invest in semiconductors in India is still in its early stages, it is likely to be pursued in a similar way, said Arpit Agrawal, head of India and the Middle East at Brookfield Infrastructure Partners, which has assets worth more than $13 billion in India.
“Can we do that in India? Sure. There is a lot of momentum behind semiconductors; it is an area we can potentially look into,” Agrawal said.
India has been seeking foreign investment in chip manufacturing and has committed more than ₹84,000 crore in production-linked incentives. Earlier this month, Maharashtra said that the Adani Group is working on a $10 billion semiconductor project with Israel’s Tower Semiconductor. On Monday, Mint reported that Tata Electronics intends to set up two more semiconductor factories in Gujarat. In 2023, several media reports have reported Reliance Industries’ intention to enter chip factories, including through a possible investment in Tower Semiconductor.
While Brookfield has engaged in some discussions with Indian companies, these plans and discussions are still at a very early stage and will require further thought and structuring, Agrawal said, declining to specify a timeline or amount for the investment as there was no certainty that a deal would be finalized. Brookfield has no minimum or maximum limit for investment in projects it is genuinely interested in, Agrawal clarified.
A Brookfield spokesman later said talks to invest in other segments, such as fiber and smart meters, were at a more advanced stage, and that its plan for semiconductors was still a thesis. The company is also evaluating opportunities to develop infrastructure for electric vehicles.
“We’ve looked at a lot of different elements, including charging infrastructure and decarbonizing public transportation,” Agrawal said. “What we’re also looking at is scale. That’s why I’m leaving out manufacturing.”
The company is currently looking to invest in the electric vehicle value chain. “We hope to be a major player in the sector in the short term,” he said.
Considering its tower business, investing in the fibre business would be an option for Brookfield. “I think it makes sense for us to be involved in it. We have about 1.5 million kilometres of fibre across the world. In India, we don’t have any investments in fibre. Is it a sector that we like? Of course, about 100,000 kilometres of fibre are being built per month in the country. It is something that we have studied in other parts of the world. It is up to us to find the right business model that works,” Agrawal said.
Reliance Jio’s Digital Fiber Infrastructure Trust has received investments from investors including the Abu Dhabi Investment Authority and Saudi Arabia’s Public Investment Fund.
Agrawal said partnering with companies is a key pillar of Brookfield’s strategy. “A lot of the infrastructure is still in the hands of companies. Putting aside the specific semiconductor situation, in general, if you think about it, a lot of the infrastructure is in the hands of companies who may think about recycling those assets because it’s not necessarily the best use of that capital, and we’re there to support them in that,” he said.
Last week, Brookfield’s Data Infrastructure Trust, along with British Columbia Investment Management Corp. and Singapore’s GIC, completed the acquisition of ATC’s Indian assets in a $2 billion transaction, making it the largest owner of telecom towers in India. This is Brookfield’s third acquisition in this space after it acquired Reliance Industries’ tower business four years ago. In 2022, Brookfield has also acquired 6,300 towers focused on small cell sites.
With this latest acquisition, the company will own over 257,000 towers in India, with room to expand further.
“Telecom towers are a business that we like. It’s a sector that we like. So, if that means that regardless of whether we need to grow organically or inorganically, we will definitely do that,” Agrawal said. “We are convinced by the story.”
In January this year, Brookfield announced a three-way joint venture with Reliance and US real estate investment trust Digital Realty to develop data centres in India.
Agrawal noted that Brookfield, which is currently developing two data centres in Mumbai and Chennai through this joint venture, could potentially act as a consolidator in the data centre segment at a later date.
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