The Department of Electronics and IT (DeitY) has requested the Ministry of Finance to introduce measures in the forthcoming budget to revive the operations of the Nokia plant in Sriperumbudur, Tamil Nadu. DeitY is of the view that such measures will help improve investor sentiment. The Ministry of Commerce and Industry is also seeking the revival of the plant.
Nokia had suspended mobile handset production at the Sriperumbudur plant with effect from November 1, 2014. The company had been involved in legal issues with tax authorities. The Nokia-Microsoft deal was completed on April 25, 2014, but the Chennai facility could not be transferred to Microsoft due to legal issues related to tax demand by the Indian government.
As per a report by the Indian Cellular Association, mobile phone exports are expected to decline to zero in 2015 from Rs 24.50 billion estimated in 2014, mainly due to suspension of handset production at Nokia’s Chennai plant. The plant directly employed 8,000 people, 60 per cent of which were women, and another additional 25,000 jobs were associated indirectly with the firm when the facility was operating in full swing.
