Nokia said to abort handset production in India as Microsoft cuts orders

NOKIAWashington, Oct 8 - Nokia will reportedly stop production at its mobile handset manufacturing facility near Chennai in south India after a deal with Microsoft to manufacture phones fell through.

According to a PC World report, the factory was among Nokia assets frozen by Indian federal authorities in a dispute over taxes for mobile phone software licenses. It was supposed to have gone to Microsoft as part of its acquisition of Nokia's phone business in April this year.

A Microsoft spokeswoman wrote in an email that the company has decided that it no longer require the manufacturing services offered by the Chennai factory and is ending the agreement with Nokia on Oct. 31.

In an email in July to employees, Microsoft devices group head Stephen Elop said the company would focus phone production mainly in Hanoi, with some production to continue in Beijing and Dongguan in China, report said.

Nokia said in a statement Tuesday that in absence of further orders from Microsoft, Nokia will suspend handset production at the Sriperumbudur facility from 1st November. (ANI)