Anil Agarwal‘s ambitions to build India’s first major chipmaking undertaking could be faced with a roadblock as the government is reportedly set to deny critical funding to the billionaire’s venture.

What Happened? The government is likely not going to give the joint venture between Vedanta Resources and Taiwan’s Hon Hai Precision Industry incentives worth billions of dollars to manufacture 28-nanometer chips in India as the venture hasn’t met the government’s criteria, Bloomberg reported.

The expected denial of funds is likely because firms are yet to identify a technology partner or license high-grade technology for the chips as neither Vedanta nor Hon Hai Precision, which assembles a large chunk of the world’s iPhones, have enough experience in making chips.

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The rejection of their proposal will delay the firms’ plans, though they can reapply for the incentives. The government has promised to support chipmaking in the country with a $10 billion (₹82,700 crore) corpus and has said it will pay half the cost associated with setting up semiconductor plants.

The rejection could add to Vedanta Group’s woes as its mining unit scours for funds to pay back debt worth $500 million (₹4,135 crore) by the end of this month and another $2 billion (₹16,540 crore) in 2024. The conglomerate is hard-pressed for cash because the sale of its zinc-mining unit to its subsidiary, Hindustan Zinc, fell through.

Price Action: Vadanta Group’s share price was down 2.08% at ₹279.65 when trading began on Wednesday.

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