BENGALURU, July 11 Reuters India39;s Vedanta fell over 2 on Tuesday, a day after Taiwan39;s Foxconn said it withdrew from a 19.5 billion semiconductor joint venture with the metalstooil conglomerate.

The companies partnered last year to set up semiconductor and display production plants in Gujarat state. Concerns about incentive approval delays by India39;s government had contributed to Foxconn39;s decision to pull out of the venture, a source familiar with the matter told Reuters on Monday.

Foxconn39;s withdrawal from the project deals a blow to Indian Prime Minister Narendra Modi39;s chipmaking plans in the country, which had become a top priority for India39;s economic strategy in pursuit of a new era in electronics manufacturing.

SP Global Ratings said that Vedanta39;s planned semiconductor business does not increase immediate liquidity pressure, adding that it believes there is no immediate sizable funding commitment for the semiconductor project, pending government approval.

The Securities and Exchange Board of India SEBI, the country39;s market regulator, had imposed a 3 million rupee36,430.76 fine nearly two weeks ago on Vedanta for disclosure requirement violations regarding the Foxconn venture.

Shares of Vedanta fell as much as 2.6 to 275 rupees apiece, after having already fallen over 24 as of last close, since the partnership was announced in February last year.

1 82.3480 Indian rupees

Reporting by Varun Vyas in Bengaluru; Editing by Dhanya Ann Thoppil…