Some $350 million will go towards setting up the iPhone component facility, which will generate 12,000 jobs, while Foxconn will tie up with Applied Materials (AMAT.O) in a $250 million project to make chip-making tools, Karnataka state said in a statement.

Reuters was first to report the investment plans on Wednesday. The state government said both projects were signed via so-called letters of intent, meaning final modalities could change.

Foxconn, which assembles around 70% of iPhones and is world’s largest contract manufacturer, has been diversifying production away from China amid COVID disruptions and geopolitical tensions.

The investment decisions follow a meeting between Foxconn Chairman Young Liu, Karnataka’s IT minister Priyank Kharge, and Industries Minister MB Patil.

“We are excited about the possibilities that Karnataka offers for our expansion plans in India,” Liu said in the statement.

Foxconn’s expansion in India is also the latest in a string of foreign companies – from Micron to Amazon – that are expanding and committing billions of dollars worth of investment in the coming years, placing a bet on growing consumption and demand in the world’s most-populous nation.

Prime Minister Narendra Modi is also attracting investors for semiconductor manufacturing, which is his key business agenda currently.

In Karnataka, Foxconn will collaborate with Applied Materials on a project for making semiconductor manufacturing equipment, and create jobs for around 1,000 people.

Foxconn also has plans to apply for incentives under a $10 billion scheme by India’s government to promote chip manufacturing, and is in talks with Gujarat to set up a chipmaking facility in the western state.

Foxconn chairman Liu has been in India and been meeting officials in several states after attending the federal government’s flagship semiconductor conference.

India’s Tamil Nadu state has also announced that Foxconn will invest $194 million in a new electronic components manufacturing facility that will create 6,000 jobs.

The Taiwanese company’s EV platform unit Mobility in Harmony (MIH) would be willing to work with its parent or another company to build the new three-seat EV priced below $20,000 and tailor-made for a corporate delivery fleet, MIH CEO Jack Cheng told Reuters in an interview.

MIH has been in talks with convenience stores, car rental companies and courier companies ahead of unveiling its first prototype EV at Japan’s largest auto trade show in October, Cheng added.

He declined to name the companies in talks with MIH, but said the car would be priced between $10,000 and $20,000. India and Thailand are likely contenders for production sites, he said, adding that he expected India to be crucial to MIH’s longer-term growth.

“You build where the potential market is…In India or Southeast Asia, you have a huge volume opportunity right now,” Cheng said, calling India a potential “emerging power for the next generation” in the EV sector.

MIH had not previously described its manufacturing strategy or the potential customers for its new vehicle.

Since 2021, Foxconn has had a joint venture with Thailand’s state-energy company PTT (PTT.BK) centred on EVs, an area of focus for the Southeast Asian country’s government.

For its part, Foxconn has so far failed to land the kind of deal that would show the EV market can be opened to the type of contract manufacturing that Foxconn came to dominate in consumer electronics for Apple’s (AAPL.O) iPhone.

Foxconn established the MIH consortium of some 2,600 suppliers two years ago with the aim of creating an open platform that could become the equivalent of Google’s (GOOGL.O) Android operating system for EVs.

Cheng conceded MIH had “not seen success yet” but said returns for participating suppliers would come with orders for a range of new EVs called Project X. The idea is to use low-cost, shared platforms to allow corporate fleet operators to order custom-made EVs.

So far, that model is largely untested, and analysts have said the best opportunity for a new EV entrant like Foxconn could close in the next few years as established automakers and startups ramp up their own production.

MIH plans to start production of the three-seat EV about 18 to 24 months after the prototype is unveiled in October, Cheng said. A six-seat EV is scheduled to follow in 2024 and a nine-seat model in 2025.

Based on its timeline, it would take MIH four years or more from its founding to first sales in a best case scenario.

But Cheng, who was a co-founder of Chinese EV maker NIO (9866.HK) and headed Fiat’s joint venture in China before joining Foxconn, said Tesla’s (TSLA.O) success with its large Shanghai plant showed how quickly an EV maker could scale up.

“I’m building another Shanghai, probably in India,” Cheng said. “If this is a Foxconn plant, fantastic, it’s the mother company, we put it into the Foxconn plant. If this is a local India plant and it’s even more competitive, give it to the India plant.”

Foxconn, which only produces a small number of EVs at present, has set an initial target of gaining a 5% share of the global market by 2025. MIH’s sales will count towards Foxconn’s target, Cheng said.

The subsidiary, Foxconn Industrial Internet (FII) (601138.SS), plans to invest 16 billion Indian rupees ($194.45 million) to build a campus in Kancheepuram district, near the state’s capital of Chennai, added the source, who was not authorised to speak publicly about the matter.

The facility will be separate from the current sprawling campus near Chennai where Foxconn assembles Apple’s (AAPL.O) iPhones and employs more than 35,000 people, the source said.

Foxconn did not immediately respond to a request for comment. The state government, which did not immediately respond to a request for comment, said on LinkedIn on Monday morning a “big announcement” was expected during the day that would mean Tamil Nadu would retain its “top position as India’s Electronics Powerhouse.”

Reuters reported last week the Foxconn subsidiary was in talks with Tamil Nadu about the investment, with the company aiming for the plant’s completion in 2024.

Foxconn’s FII makes electronic devices, cloud service equipment and industrial robots. It was not immediately clear if the new India plant would make components for iPhones or for other companies, or both.

An official announcement is expected from the state government later in the day, with Foxconn chairman Young Liu, who has been in India to attend the federal government’s semiconductor conference, attending the signing ceremony with state chief minister, the source said.

Foxconn plans to quadruple the workforce at its iPhone factory in Tamil Nadu by late 2024 in a bid to spread its bets beyond China, Reuters reported last year.