Nokia seeks incentives to penetrate rural Indian market
Friday, 13 October 2006, 19:30 IST
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HELSINKI: Nokia, the Finland-based telecom company and mobile phone manufacturer with a major presence in the Indian market, has sought incentives from the Indian government to improve operations, particularly in penetrating rural areas. The company has also sought flexibility in labor laws and a reduction in customs duty on imported telecommunication-related equipment for making telecom services affordable. Nokia India has diversified into a number of activities, including mobile phones, enterprise solutions, customer and market operations, research and manufacturing. Earlier this year, Nokia India had set up a special economic zone (SEZ) spread over an area of 210 acres at Sriperumbudur in Tamil Nadu. It has also set up its manufacturing unit there and is expecting nine key suppliers in the telecom sector to be housed within this SEZ by the end of next year. "The Indian market has a huge potential but there are certain imperatives for continued growth that need to be looked into," said Ashish Chowdhary, Nokia's country director (India), while addressing delegates at the India-European Union business summit. "Rural areas hold the key for growth in the telecommunication sector but to ensure that this potential is tapped, there is a need for promoting international standards at the domestic level," he added. Chowdhary emphasized the need to rationalize duty and tax structure in the country to give a new impetus for growth in the telecom sector, especially in the rural areas. "Last month alone, addition of a record 6.2 million new subscribers of wireless phone services has brought the number of such connections to 122 million in India but the rural areas still has less than two percent teledensity. That indicates the potential of the Indian market," Chowdhary said. "The proposed countervailing duty at the rate of 16.32 percent on cellular mobile phones with effect from Jan 1, 2007, and similar taxation on mobile phone spare parts should be reviewed to prevent increase in the price of mobile phones," he added. He stressed that India is a challenging market and infrastructure bottlenecks are proving to be a major hurdle in the country's economic growth. He said that there is a strong requirement to upgrade the physical infrastructure in India. Unveiling the future outlook of Nokia in India, he said that Nokia is not looking at the Indian market as a place where one can only sell mobile phones or other services but in a much wider perspective where one can create advantages that can be leveraged at a global level. "We have set up a manufacturing unit in India and a monitoring center in Chennai which helps in monitoring several functions of the company in various parts of the world," he added. "The secret of our success in a tough market like India is that we have customized solutions to suit the local requirements and we would continue to do so," said Chowdhary.
Source: IANS
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