Even as Nokia Siemens Networks has globally announced cost-cutting measures, the telecom equipment maker is increasing investments into India.
The company has decided to ramp up its India operations in three core areas of mobile broadband, manufacturing and Global Network Operations Centres.
Hub of transformation
“India will be the hub of the transformation that NSN has initiated globally. Investments into India are being ramped up in key focus areas, including global delivery centres and manufacturing. So all of these facilities which gives us global scale and advantage of centralisation is being ramped up,” Mr Sandeep Girotra, head of Nokia Siemens in India, told
NSN had earlier announced that it will cut 17,000 staff worldwide as part of a major global restructuring to focus on more profitable operations.
The company, which is jointly owned by Nokia and Siemens, is looking to improve profitability by reducing operating expenses and overheads by €1 billion by the end of 2013.
While the exact impact of this on NSN's India operations is not known, Mr Girotra said that 95 per cent of the work being done in the country fits in with the company's new global strategy.
New strategy
“The details are still not worked at the concept level. But this doesn't change the fact India is a priority market. Be it services or mobile broadband or manufacturing India is an important leg to NSN's global story. Only about 5-7 per cent of the business in Indian is not in the big picture which are being cleaned up,” Mr Girotra said.
He said the new global strategy was necessitated because the industry was going through a rapid transformation. “As a vendor we cannot be everything to everyone anymore. We need to be big in the areas where we want to play in. Concept of one stop shop is not relevant anymore.
“Therefore, the growth areas will be mobile broadband, customer experience, and optical. So, we are putting more investments into these areas and our India operations fits in well with this,” he said.
…but uncertain about Kolkata plant
The global restructuring has created some uncertainty about the future of Nokia Siemens factory in Kolkata which primarily deals with products for the fixed line telephony segment.
Mr Sandeep Girotra, Head of Nokia Siemens, said that globally, the company has taken a decision to either exit or hold assets in non-core areas, including the fixed line business.
“Fixed line business is something which we have called out as the non-focus area so we treat it as the maintain/exit mode. But exit doesn't mean shut down, it could mean selling it to another company like we did with our microwave business. We don't know the details any further as of now,” Mr Girotra said.
The Kolkata facility focuses mostly on repair and replacement, customer specific configuration, validation and approvals of fixed line products
There are 73 permanent employees in this facility and 125 contractual staff, including housekeeping and support staff. Some employees at Kolkata unit said that there was no intimation from the company about their jobs but the mood is sombre due to the uncertainty.
The West Bengal IT Services Association — an apex body of IT employees — claimed that there are fears among employees at NSN's Kolkata office about the unit being shut down.
When contacted the West Bengal Labour Minister, Mr Purnendu Basu, said he had no knowledge of the matter but will intervene if required.
“I know that there will global job cuts. However, we are not aware of the impact that it will have in their Kolkata office or whether they will shut down Kolkata operations. In case, there are employee grievances or their rights violated, we will definitely intervene and take up the matter,” he said.
(Abhishek Law, Thomas K Thomas)