The Telecom Equipment & Services Export Promotion Council expects the closure of Nokia's Chennai plant to bring down India's telecom exports by 40 per cent this year.
Telecom equipment exports from India declined about 7 per cent to Rs19,654 crore in 2013-14 from Rs21,075 crore in the previous year, according to the council.
Handset exports account for more than half of all telecom product exports from India, and are dominated by Nokia.
Mobile phone exports from the country dropped to Rs11,918 crore in 2013-14 from Rs14,870 crore in 2012-13.
Nokia's shipments from India were valued at about Rs8,000 crore, as per TEPC data, which is about 40 per cent of telecom equipment exports.
Nokia India is facing a huge tax burden and unable to amicably close the $7.2 billion deal with Microsoft to sell its mobile phone business (See: Microsoft to acquire Nokia's handset business for $7.1 bn).
If Nokia cannot solve the tax issues, its plant in Chennai will become an outsourcing unit for Microsoft, as domestic sales would be disallowed.