“PLI has transformed India’s domestic telecom manufacturing”

How do you describe India’s efforts toward becoming self-reliant in communications and connectivity equipment and devices?

The Government of India has set out mega plans to establish the country as one of the global manufacturing hubs for telecom equipment. Until a few years back, India was heavily dependent on foreign-made equipment to address the local\ demand for equipment and devices in the absence of a robust ecosystem. However, it has come a long way in the last few years, thanks to the several schemes and measures by the government to reduce the dependency on foreign-made equipment and boost local manufacturing. Atmanirbhar Bharat, the flagship program of the government, has resulted in the building of a strong 4G and 5G ecosystem in the country.

Today, the majority of the equipment for the ongoing nationwide 5G rollout, talking about Nokia in particular, is being manufactured locally. Not just that, we are also exporting 5G equipment to some of the most advanced markets in the world, from our Chennai factory. The structural, procedural and policy reforms are, for sure, playing a very significant role in creating a conducive environment to promote manufacturing and generate growth opportunities for the manufacturers.

What has been the impact of PLI and DLI initiatives by the government on the manufacturing of communications and connectivity equipment and devices in India?

The Production Linked Incentive (PLI) scheme has been one of the most significant measures taken by the government to enable and support local manufacturing for telecom and networking products. The scheme has been instrumental in transforming the domestic telecom manufacturing sector and is also playing a crucial role in boosting India’s export of telecom gear as well. Nokia is a major investor and producer under the PLI scheme and has already exceeded its target for the first year of the programme.

Nearly all 4G radios for the domestic market are manufactured locally at our Chennai factory and we aim to follow the same trend for 5G radios.

The design-led production-linked incentive (DLI) scheme, sometimes referred to as PLI 2.0, aims to promote design lead manufacturing and offers an additional incentive, for products designed in India. The scheme is primarily aimed to support the local designing of telecom products and encourage R&D-driven manufacturing in the country. It is posed to play a pivotal role in creating the entire value chain, from designing to manufacturing, and Nokia is proud to be part of PLI 2.0 as well.

What initiatives has Nokia taken up towards meeting the Make-in-India goals and what are the products that it is manufacturing in the country?

Nokia’s facility in Chennai, set up in 2008, is one of the largest Nokia-owned manufacturing facilities in the world. The facility is spread across 140,000 square meters and Nokia has made capital investments of over Rs 600 crore. The facility manufactures a wide range of telecom products and exports over 50% of manufactured equipment to global markets. The site has to date delivered close to 7 million units for global telecom needs. The factory was the first to deploy India’s first ‘real-world’ application of Industry 4.0 including AR, VR, automation, and analytics, to enhance operational efficiency and productivity.

Having a strong domestic manufacturing base enables Nokia to address the local demand, like 5G equipment for ongoing rollouts, much faster.

In February 2023, the company announced the extension of fibre broadband equipment manufacturing in India. The decision comes in response to increasing demand from local customers in India, as well as international markets. This further adds to our efforts in strengthening India’s manufacturing capabilities and establishing it as a global manufacturing hub.

How has India’s push for local manufacturing and indigenisation of communication hardware impacted Nokia’s business?

From being the first to manufacture 5G NR in India to producing 5G massive MIMO products, Nokia has always relied on India’s skill and talent to produce the best-in-class equipment. Nearly all 4G radios for the domestic market are manufactured locally at our Chennai factory and we aim to follow the same trend for 5G radios too. The fibre broadband equipment manufacturing, that we added recently, has further widened our portfolio. We are now able to better address the demand for radio and fibre broadband equipment in the region and worldwide.

We are the biggest equipment supplier in India, with a presence across all four communication service providers. Having a strong domestic manufacturing base provides us with a distinct edge as we can address the local demand, for instance, 5G equipment for ongoing rollouts, much faster.

What are Nokia’s mid- and long-term plans for manufacturing in India and exports from the country?

We continue to seek opportunities to expand our manufacturing portfolio in India in line with the demand from various markets. We would continue to leverage our Chennai facility as a global hub to expand the company’s production base and geographic reach as part of our mid- and long-term plans.

What additional policy supports does the industry need to make India a manufacturing hub for the world?

Nokia fully supports various government initiatives, including the PLI and DLI schemes that aim to establish India as the future global manufacturing hub. Additional measures such as providing greater market access to global manufacturers and OEMs, reducing import duties on silicon components where there is minimal local production at present, enabling semiconductor ecosystem development, increasing ease-of-business in telecom product certification and approvals for faster time-to-market etc. would help to further accelerate the entire process.

Amit Marwah

Head, Marketing and Corporate Affairs (CMO), Nokia India

By Shubhendu Parth

shubhendup@cybermedia.co.in