Thomas K. Thomas
New Delhi, Dec. 1
THE Finance Ministry has given the nod to Finnish telecom major Nokia for setting up a Special Economic Zone (SEZ) at Sriperumbudur in Tamil Nadu for manufacturing telecom equipment and mobile handsets.
Highly-placed government officials told Business Line that the necessary approvals and benefits for Nokia's SEZ has been given after the company agreed to acquire additional land which was the minimum required by law for it to be declared an SEZ.
It is understood that the company had told the government that its investments in India could be affected due to a delay by the government in notifying customs duty benefits for the SEZ. According to reports, Nokia had even begun to consider alternative locations like China if the notification was not issued soon.
When contacted, Nokia India spokesperson, however, said that the company's plans were on track. "India is an important market for Nokia and there are no changes to Nokia's commitment to the Indian market. Our manufacturing facility in Chennai is in an advanced stage of construction and we are on course to commence production at this facility in the first half of 2006," said a statement from Nokia. The company said that it was confident that it would be able to work with the Government of India to ensure smooth progress of the Chennai project. Nokia had earlier announced over Rs 650 crore of investment in the country to set up a manufacturing base.