Finnish handset vendor Nokia said it plans to launch a handset based on China’s homegrown TD-SCDMA 3G standard before the end of 2009.

The world’s biggest handset vendor said this week it has already started the development of a TD-SCDMA device based on the Symbian S60 OS.

Despite its leading position in the handset market, as well as having Symbian dominate the smartphone space, Nokia will still be looking to build market share wherever it can. Last month the vendor confirmed what many have come to fear of late, the sharp pullback in consumer spending worldwide has hit the mobile devices market hard. Nokia’s preliminary estimate for industry mobile device volumes is down for 2009 compared to 2008, impacted by the economic slowdown.

In the summer the Chinese government month put into action a master plan that will pave the way for the long awaited introduction of third generation services.

Under the terms of the strategy, mobile market giant China Mobile acquired small fixed line player China Tietong (formerly China Railcom), and leading fixed line player China Telecom bought the CDMA network operations of second placed mobile operator China Unicom. China Unicom maintained its GSM operations but merged with second ranked fixed line operator China Netcom.

The idea, according to the Ministry of Industry and Information (MII), the Ministry of Finance and the powerful National Development and Reform Commission (NDRC), is that the restructuring process will create three strong, integrated operators that would all be allocated 3G licenses.

But questions still remain over the allocation of 3G licences. Although China has expressed much support for its home grown TD-SCDMA standard, evidence of the technology’s maturity is hard to come by.

Nevertheless, senior members of the government likely see the deployment of TD-SCDMA as a political obligation, and it still looks like China Mobile will be bearing this particular burden.