Nokia inaugrates manufacturing unit in India

The cellular handset manufacturing plant which currently employs around 1,100 people was formally inaugurated today, 11 march, 2006. Present at the inauguration were the Prime Minister of Finland, Matti Vanhanen, Minister of Transport and Communications, Susanna Huovinen, Tamil Nadu Governor Surjit Singh Barnala, Secretary to the Government of India and Chairman of Telecom Commission Dr J S Sarma, and senior Nokia executives including Jorma Ollila, chairman and CEO, and Robert Andersson, executive vice-president, Customer & Market Operations, amongst others.

The facility, which started production on January 2, 2006, will produce fast moving products of low and medium range. Set up at a cost of USD 150 million, the unit will support the growing demand for mobile handsets and network infrastructure in the Asia-Pacific region in a cost efficient and customer focused manner. The unit too plans to become an export centre to meet the global demand.

Nokia has played a pioneering role in the growth of cellular technology in India, starting with the first-ever GSM cellular call a decade ago on a Nokia mobile phone over a Nokia-deployed network. The addition of a manufacturing facility in India strengthens Nokia's commitment to the market. ”We anticipate that there will be a long-term sustainable demand for mobile telephony in the fast growing Indian market. In fact, we estimate that India will become the world's second biggest mobile device market when measured by volumes in year 2010”, said Jorma Ollila, chief executive of Nokia.

However, there are indications that while the new facility will offer high cost advantage and lesser time to take a product to the market, drastic reductions in prices of handset need not be expected immediately, as margins are low, a company official said.