Foxconn, contract manufacturer of consumer electronic products, is expected to create jobs in Tamil Nadu equal to those lost due to the closure of Nokia's factory in 2014.
Foxconn said it will expand its facility in Chennai, providing job to around 5,000 people at an investment of around Rs 300 crore, said Tamil Nadu Industries Minister M C Sampath.
The company has also assured the government it will provide 30,000 jobs in total, equivalent to what the beleaguered Nokia factory was providing at peak operations, in next two to three years, he added.
"We have granted approval for the 49-acre facility where already 7,000 employees are working. The company has said that it will invest around Rs 300 crore and will employ 5,000 more people in January," said the minister in the sidelines of CII Connect 2017, an ICT conference organised by Confederation of Indian Industry (CII) with the support of the Government of Tamil Nadu.
"We have received assurance from the company that they will provide employment to a total of 30,000 people over the next three years. This is equal to the number of employees who worked in the Nokia facility in Sriperumbudur," said the minister. There have been reports that Nokia's manufacturing facility, which was locked in a tax litigation, stopped operations after the global major encountered a tax litigation in the country.
The Finnish electronics manufacturer soon sold its mobile handset manufacturing business globally to Microsoft, excluding the Chennai facility, which was manufacturing the lower end mobile phones. This lead to the closure of the manufacturing facility.
Around 30,000 labourers worked in the Nokia factory at peak operations and the company offered severance package to those who were working at the time of closure. Soon, some of the component manufacturing units that were functioning close to the Nokia unit also stopped operation, leading to additional job losses. Industry experts then opined that the industry had lost confidence in investing in the State.
The Minister reiterated today that the closure of Nokia facility has not affected the industry-friendly image of the State. He said that the Nokia facility cannot be opened or utilised as of now, since the tax dispute is continuing and a final decision is yet to be taken.
The Central Government had earlier formed a task force to look into the issues related to manufacturing electronic goods in India, which has delved into the issue of Nokia manufacturing facility. The State government has also sent a delegation to Taiwan to meet the Foxconn management, seeking their interest in reopening the defunct Nokia unit.
The Minister said the Foxconn facility in Chennai is making components for mobile phones and is expected to undergo an expansion to accommodate more workers and capacity.