A day after Finnish handset manufacturer Nokia
announced it would suspend operations at its Chennai plant from
November, the government Wednesday said it will look into the issue and
try to ensure that such incidents do not recur.
“We
will certainly see how best matters don’t occur again and we will
encourage the ‘Make In India’ campaign,” Commerce and Industry Minister
Nirmala Sitharaman told mediapersons here in response to a query on the
issue.
“This is an issue specifically related to a
particular company and there is an issue on that. We are seized of the
matter. We will look at it,” she added.
Prime
Minister Narendra Modi had in his Independence Day speech announced the
“Make in India” campaign inviting companies across the world to make
their products in India and create jobs in the labour-intensive manufacturing sectors.
Nokia on Tuesday announced suspension
of operations at its Chennai mobile handset plant from November 1 after
Microsoft terminated an agreement to buy handsets from the unit.
“Microsoft
has informed Nokia that it will be terminating the manufacturing
services defined in the agreement with effect from November 1,” a
statement said.
“In absence of further orders from
Microsoft, Nokia will suspend handset production at the Sriperumbudur
facility from November 1. Unfortunately, the continuing asset freeze
imposed by the tax department prevents Nokia from exploring potential
opportunities for the transfer of the factory to a successor to support
the long-term viability of the established, fully functional electronics
manufacturing ecosystem,” Nokia added.
Tax
authorities allege that Nokia avoided paying taxes by wrongfully
claiming an exemption on software exports. The charge has been
challenged by the company in court.
As per the Nokia India employees union, there are nearly 1,000 employees still working at the factory.
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