Tax issue between Indian govt and Nokia not to impact its phone business: ICA

The ongoing Rs 10,000-crore tax dispute between the Indian government and Nokia will not have any bearing on sales of Nokia brand phones through new entity HMD Global, Indian Cellular Association National President Pankaj Mohindroo today said.

"Tax demand is an independent issue which the government of India and Nokia are trying to resolve amicably. It will not have any impact on sales of Nokia phones in India. A separate entity HMD Global has plans to sell Nokia brand phones," Mohindroo told PTI.

The income tax department has tentatively raised a Rs 10,000-crore demand from Nokia, which the company has contested.

In the latest development, Microsoft, the owner of Nokia's mobile device business, has agreed to sell the latter's branding rights to Finnish firm HMD Global and contract manufacturer Foxconn for $350 million.

"Nokia is very strong brand in feature phone segment. Foxconn is already making Nokia feature phones in India. With the kind of capacity they have in India and Vietnam, Nokia phones exports can also be started from here. Foxconn's lots of capacity in India are unutilised," Mohindroo said.

HMD and Nokia Technologies have signed the pact with FIH to establish a collaboration framework to support the building of a global business for Nokia-branded mobile phones and tablets.

"With this deal, I also don't see any impact on Microsoft's mobile phone business. It is there strategy to sell Windows based phones which they are continuing to do so through Lumia smartphones," Mohindroo said.

Post closure of this deal between Microsoft, FIH and HMD, some 4,500 employees will move to or have the opportunity to join FIH Mobile or HMD Global Oy subject to compliance with local laws.

Microsoft will continue to develop Windows 10 Mobile and support Lumia phones such as Lumia 650, Lumia 950 and Lumia 950 XL, and phones from OEM partners like Acer, Alcatel, HP, Trinity and VAIO.

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