Aapo Pölhö in Calcutta on Monday. Picture by Kishor Roy Chowdhury

Calcutta, March 10: Tax and regulatory issues have hurt India’s prospects as a foreign investment destination and the country needs to resolve them soon to send out a positive signal.

Key businesses looking to expand beyond China, owing to the rising operational costs there, could give India a miss and opt for countries such as Vietnam instead, Finnish ambassador Aapo Pölhö said today.

Incidentally, Finnish handset maker Nokia is engaged in a tax dispute case with India.

“Over the past couple of years, tax issues, retrospective taxation and regulatory issues have hurt the image of India abroad, including in Finland. What used to be seen as a predictable investment destination has become less predictable. This is a bit unfortunate,” Pölhö said.

“FDI needs a certain investment climate. I see India losing opportunity. I wish that Indian and Finnish companies will be able to form partnerships beneficial to both,” he added.

He was speaking at a session on trade prospects between India and Finland organised by the Bharat Chamber of Commerce here today.

On whether his comment referred to the Nokia dispute, he said the handset maker was not alone. Vodafone and IBM have also faced the brunt.

Bilateral trade with Finland rose to 1,295 million euros in 2011 from 680 million euros in 2009.

Nokia launch

Nokia today launched the Android-based smartphone X in India for Rs 8,599 in a bid to protect its turf in the fiercely competitive market.

The company had announced the Nokia X family of affordable smartphones, which can run Android apps, at the Mobile World Congress in Barcelona last month.

The company had said Nokia X+ was expected to be priced at 99 euros (about Rs 8,400), Nokia XL at 109 euros (about Rs 9,200) and Nokia X at 89 euros (about Rs 7,500).

Nokia said it would bring the other two devices — X+ and XL — in the Indian market in the next 60 days.