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India ‘least favourable market’, says Nokia

Al Bhatti

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August 23, 2013

India ‘least favourable market’, says Nokia

Finnish company urges the government to act quickly to correct the wrong perception as it fights Rs20b tax demand from authorities

Finnish telecom giant Nokia has told India’s government that the country is now its “least favourable market” to operate in and it makes better sense to export its products from China, a report said Friday.

Nokia, which is fighting a Rs20-billion (Dh1.15 billion, $311 million) tax demand from Indian authorities, urged the government to “act quickly to correct the wrong perception of India as a place for business”, The Indian Express newspaper reported.

“The political risk of operating in India” has become “suddenly substantially higher and may inevitably influence future decisions to develop one’s operations in India”, Nokia said in a letter quoted by the daily.

The reported warning comes at a bad time for India when foreign direct investment has slowed to a trickle amid mounting domestic economic woes including a plunging rupee, a huge current account deficit, slowing growth and perceived government policy paralysis.

Cost-efficient

The Finnish group did not immediately respond to requests for comment on the message which The Indian Express said was dated June 19 and was received by the finance ministry last month.

Nokia said its tax problems made it “more cost-efficient for Nokia to transfer the manufacture of mobile phones to China and to import them to the Indian market rather than manufacture them in Chennai”.

Nokia, which has one of its biggest plants world-wide in the southern city of Chennai, is among a string of multinationals in tax disputes in India including Cadbury Royal Dutch Shell and Vodafone.

India has stepped up its pursuit of alleged tax delinquents to reduce a hefty budget deficit.

Nokia insists software downloaded onto its mobiles in India should to be taxed in Finland under a bilateral treaty between the countries, but India’s tax authorities view it differently.

Impact

“Nokia does not think India can override its international obligations,” Nokia was quoted as saying.

Tax claims against Nokia and other multinationals have “too great an impact on the predictability and certainty of Indian business environment to be ignored”, Nokia added.

India — one of the world’s fastest-growing mobile phone markets — is the second largest market for Nokia which began operations in the country in 1995 and employs 8,000 workers directly in Chennai.

Nokia which had been the country’s leading handset maker for 14 years recently ceded its crown to South Korea’s Samsung.

India
 
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Samsung, Apple and some home grown companies like Micromax are doing well in India these day.
 
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weather we like nokia product or not ,we should give them right conditions to manufacture if they dont sell here they can sell some where else , but we should create favourable conditions for them to stay. This stupid gove has to take apropiate measures.
 
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Let our Micromax capture the market, they are doing well :cheers:
 
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i like nokia until 4 years ago... now my vote for Samsung... next HTC...
 
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Infact Nokia OS windows is really really good ! Give some time to mature it Like Android.

Android gets infecting with Malware ,,,Windows Never ,,they refrain from getting some apps like Android Does to avoid malware,,

Windows needs time to Mature !

Tc




micromax and samsungs have swept the indian market .. nokia's biggest drawback is its OS...
 
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Nokia make pathetic phones now. Micromax is going to lead within near future. At present Samsung is on top. So we just dont care whether you stay or go. Moreover, Nokia has done nothing for dalits.

You're right. Nokia belongs to the brahmin caste.
 
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Nokia make pathetic phones now. Micromax is going to lead within near future. At present Samsung is on top. So we just dont care whether you stay or go. Moreover, Nokia has done nothing for dalits.

why you pick dalits here????/
 
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You always speak the truth. How can I disagree.

Exactly. We should not lie at all. Always speak the truth. No matter what. That's the legacy of Mahatma Gandhi. Nokia people don't like Gandhi. Micromax people does.
 
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