Tamil Nadu urges lifting freeze on Nokia India's assets

Tamil Nadu Chief Minister O. Panneerselvam Sunday urged the central government to lift the asset freeze on Nokia India so that other mobile phone-makers can open the unit.

He also said the state government was in favour of labour reforms.

Speaking at the first meeting of the governing council of Niti Aayog here, Pannerselvam said: "Retrospective amendments to the Income Tax Act in 2012 with effect from 1976 and levy of a huge penalty on the world's largest mobile handset manufacturing plant located in Tamil Nadu resulted in the closure of the unit."

Without mentioning Nokia India's name, Panneerselvam said other handset manufacturers were willing to step in to open the unit and this has to be facilitated by lifting the assets-freeze imposed by the Income Tax authorities.

Finnish handset-maker Nokia had sold its mobile phone business to Microsoft. However the Indian assets were excluded from the sale owing to the tax demand.

Panneerselvam also said the inverted duty structure had put the domestic electronic hardware-makers to disadvantage as against imports.

"Already 65 percent of the domestic demand is met by imports and Indian electronics import bill is projected to exceed the oil import bill by 2020. Policy corrections in this area are vital for the "Make in India" campaign to have meaning," he said.

In the area of labour reforms and amendments to labour legislations, Panneerselvam said the state agreed with the need to implement proactive reforms for enhancing the ease of doing business.

However, he added that all legislations should include adequate safeguards and protection for workers and the views of the state government should be sought and reflected in the process of amending and repealing Acts and legislations.