Chennai pips Bangalore for Nokia plant

Nokia selects Chennai for cellphone plant; to hire 2,000

Rediff

Global mobile handset major Nokia on Wednesday announced that it will set up a manufacturing facility for mobile devices at Chennai in India.

Pekka Ala Pietila, President, Nokia, informed Telecom Minister Dayanidhi Maran from Helsinki about the company board's decision to set up the manufacturing plant in Chennai, official sources said.

The manufacturing unit in Chennai will be Nokia's tenth mobile device production facility globally. Nokia anticipates investing an estimated $100-150 million in the India production plant.

"Establishing a new factory in India is an important step in the continuous development of our global manufacturing network. We selected Chennai to be the location for the factory thanks to the availability of skilled labor, friendly business environment, support from the state government, good logistics connections and overall cost-efficiency," said Ala-Pietilä.

Nokia's new facility in Chennai is in the state of Tamil Nadu in the southern part of India. The construction work at the site of the manufacturing unit will start in April and production is expected to begin in the first half of 2006.

Nokia foresees ramping up the factory gradually and the work force reaching approximately 2,000 employees when production is full scale.

Mobile penetration in Asia Pacific is expected to be a major contributor to the global mobile subscriber base surpassing the two billion mark by the end of 2005.

Therefore, India which is set at the heart of the region where mobile communications is growing rapidly was a natural location of choice for the new production facility.

In India, Nokia is the market leader in mobile devices. Nokia maintains sales, marketing, customer care, and research and development sites in the country. Nokia was recently recognized as the Brand of the year by the Confederation of Indian Industry as well as the most respected consumer durables company by the BusinessWorld magazine.