Report: Huge Nokia Plant in India Shutting Down

Nokia will reportedly close a manufacturing plant in India amidst an ongoing dispute with the country's tax authorities.

As reported by Reuters, the massive plant - which employs some 20,000 workers - will shut down on Nov. 1.

The future of the plant, which makes phones, has been in question ever since Microsoft purchased Nokia's handset business. According to a Times of India report from April, workers went on strike in 2013, and demanded that the Chennai plant be included in the Microsoft-Nokia deal, but tax issues hampered a deal.

There were rumors that HTC would buy the plant, a report the phone maker quickly shot down. Ultimately, Nokia retained ownership of the plant, and operated it as a contract manufacturing unit for Microsoft, Reuters said.

Nokia did not immediately respond to PCMag's request for comment. But a spokesperson told Reuters that 'Microsoft has informed Nokia that it will be terminating the manufacturing services defined in the agreement with effect from Nov. 1. In absence of further orders from Microsoft, Nokia will suspend handset production at the Sriperumbudur facility.'

India's tax department accused Nokia of wrongfully claiming tax exemptions on software exports, The Wall Street Journal said. Nokia denies any wrongdoing and has turned to international arbitration.

The announcement comes as Google's Android One platform made its debut in India, offering its first low-cost phones, from hardware partners Micromax, Karbonn, Spice, and MediaTek, for 6,399 Rupees ($104).