After Nokia, Yahoo fiascos, govt says 'won't allow such matters to happen again'

Written by Subhash Narayan | New Delhi | Updated: Oct 9 2014, 17:18pm hrs
Nirmala SitharamanWe will see how best such matters (Nokia) do not occur again, said NIrmala Sitharaman. (PTI)
With Nokia shutting Chennai factory, Yahoo shedding jobs, Narendra Modi govt reiterates faith in 'Make in India' campaign.

Government on Wednesday said that it will not let Nokia and Yahoo kind of debacles from happening again, and reiterated its commitment to encouraging a business friendly environment in the country, which boosts manufacturing and helps in creating jobs.

We will see how best such matters (Nokia) do not occur again and we will encourage 'Make in India Campaign', Sitharaman said.

She was responding to queries directed at her on Nokia announcing suspension of work at its Chennai mobile manufacturing plant and its possible impact on Narendra Modi government's pet 'Make in India' project. The Yahoo issue did not elicit a separate response.

'Make in India' programme has been specifically launched with the idea of providing jobs to about 10 million workforce that gets added in the country every year. The Yahoo and Nokia fiascos are being seen as having negative impact on crating favourable ground for attracting investment in Indian manufacturing.

While the PM's recent US visit focused around getting more defence entities there to consider investment in setting up facilities here, there is serious thinking in the government to encourage even existing units of multinationals in the country as part of the 'Make in India' campaign.

This is an issue (Nokia) specifically related to a particular company and there is an issue on that. We are seized of the matter. We will look at it, the minister said.

Nokia has announced suspension of work at its Chennai facility from November 1 after Microsoft terminated an agreement to buy from the unit. This was done as tax authorities have frozen assets of telecom giant in India due to a tax dispute that prevents Nokia from transferring the unit to a successor. About 600 employees are still working at Nokia's Chennai facility.

On Tuesday, Yahoo Inc also confirmed that it was downsizing its Bangalore office, which employs roughly 2,000 employees and is Yahoo's largest engineering facility outside California - company has sacked 400 people.