Indian software company Zoho has put its $700m chipmaking project on hold, reported Reuters citing sources with knowledge of the matter.

The company, which is valued at approximately $12bn, has faced challenges in securing a technology partner to guide them through the intricate chipmaking processes, the report said.

Zoho’s co-founder Sridhar Vembu previously emphasised the importance of semiconductor technology for the nation.

The company was unable to find a suitable tech partner, leading to the suspension of the entire chipmaking initiative which was announced in May 2024.

One of the sources said: “Zoho could not find a tech partner despite an extensive search.”

The future of Zoho’s chipmaking ambitions remains uncertain, and it is unclear whether the plans will be revived should a suitable partner emerge.

The company had planned to invest $400m in a facility in Karnataka, a state in southern India. It was expected to create 460 jobs.

Earlier, the Karnataka government granted approval for Zoho’s proposed facility in the Mysuru region.

A Zoho spokesperson has declined to comment on the suspension, and representatives for the Karnataka state have not yet responded to requests for comment.

Established in 1996, Zoho offers “cost-effective” alternatives to cloud-based software tools similar to those provided by industry leaders like Microsoft.

Zoho provides tools and services to businesses across 150 countries. It boasts more than18,000 employees and more than 120 million users worldwide.

In the previous year, Zoho’s subsidiary, Silectric Semiconductor Manufacturing, had made a few strategic hires and established a board to oversee the chipmaking operations.

The latest move comes soon after Reuters reported that Adani group halted discussions for a $10bn chip project with Israel’s Tower Semiconductor citing that the venture did not align with its strategic and commercial objectives.