India likely to be production base for 5G telecom systems
Nokia, which sold its devices business to Microsoft last year, has big plans for its network solutions business in India.
Though Nokia Networks already has a strong manufacturing presence in the country, with a factory in Chennai and an overall headcount of 11,000 — and it claims to be the country’s largest international telecom infrastructure manufacturer — as part of its growth plans, the company has decided to increase localisation from 20% to around 45% in three years’ time.
For this, it has been in talks with a slew of global suppliers for setting up facilities near its Chennai plant, said Karl Kirschenhofer, vice-president of manufacturing operations, global operations, Nokia Networks. Kirschenhofer was here on Wednesday to celebrate the Chennai plant reaching the milestone of 2 million units after its inception in 2008.
Speaking to journalists at its Oragadam plant, he said the company was currently not in a position to procure the required components locally because of lack of suitable vendors. We want to increase the localisation to reinforce the company’s commitment to the Make in India initiative.We are in talks with global suppliers, including Chinese majors, to set shop here in Chennai,” he said.
The company, which is partnering the process of standardisation of 5G networks globally, will look at commercialising 5G telecom equipment by 2018. It may choose the Chennai plant for these products.
“We are involved in the process of standardisation of 5G network, and we will decide close to the date from which country and plant we should produce those products. Chennai plant is definitely an option,” Kirschenhofer said. He added that technology ewas being standardised and commercial implementation is expected to be in 2018 during the winter Olympics.
With a workforce of 1,200, Nokia Networks’ Chennai unit is its largest in the Indian telecom manufacturing sector and a strategic hub of Nokia’s global operations. The company so far has invested Rs 500 crore in the facility.
“Our Chennai facility is a world-class factory similar to our other global factories and makes cost-efficient deliveries possible to operators around the globe include India, the US and Europe. In addition, it is providing industrialisation and engineering services to support the development and introduction of new products,” said Kirschenhofer.
“The Chennai facility produces equipment for 2G, 3G and 4G networks and, of these, a third is being exported overseas,” he said.
Nokia Networks will work as an independent unit in India and compete against Alcatel Lucent till a clear signal on integration is obtained from the headquarters. Nokia Corporation had recently announced an agreement with Alcatel Lucent to acquire the latter, according to officials.