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Business News/ News / India/  Telcos can only use govt approved gear from 15 June
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Telcos can only use govt approved gear from 15 June

The tightening of procurement rules could impact Chinese equipment suppliers

Telcos can only use govt approved equipment from 15 JunePremium
Telcos can only use govt approved equipment from 15 June

New Delhi: India on Wednesday tightened rules for procuring telecom equipment, mandating operators to buy gear approved by it due to concerns over national security, a move that could impact Chinese equipment suppliers.

The decision comes ahead of the planned rollout of 5G wireless service that requires large-scale deployment of optical fibre and towers.

The government-appointed authority has yet to finalize a list of “trusted" vendors though the latest development threatens to deal a blow to Chinese telecom gear makers Huawei and ZTE, against whom security concerns have been raised in some countries.

In December, the UK government said installation of Huawei’s 5G equipment will be banned from September 2021, as it seeks to phase out all Huawei networks by 2027. The US has also banned Huawei gear till May on grounds of national security risks.

A ban on Chinese gear could inflate the cost of procuring equipment for domestic operators. Bharti Airtel Ltd and cash-strapped Vodafone Idea Ltd use Huawei and ZTE gear. Reliance Jio Infocomm Ltd, a relatively new player in the industry, does not use any Chinese equipment. Besides Huawei and ZTE, Ericsson, Nokia and Samsung also manufacture wireless telecom equipment.

As part of the security conditions, the department of telecommunications (DoT) has added a clause to the Unified Service Access Licence Agreement, saying that the government can impose riders on procurement of equipment on grounds of defence or national security. The government has authorized the National Cyber Security Coordinator (NCSC) to this effect and telecom operators will have to provide information as and when sought by the authority.

The NCSC will notify a list of “trusted sources" along with the equipment that do not threaten India’s national security. It may also name the vendors who will be barred from selling telecom gear in the country.

“With effect from 15 June, the licensee shall only connect trusted products in its network and seek permission from the designated authority (NCSC) for upgrade of existing network utilizing the telecommunication equipment not designated as trusted products," the DoT said.

“However, these directions will not affect ongoing annual maintenance contracts or updates to existing equipment already inducted in the network as on date of effect," it added.

India is yet to deploy 5G services. The government expects the rollout of the next-generation technology by the end of 2021. However, this is not likely to happen on a pan-India basis, but in areas where the demand justifies the investments.

The government may also conduct 5G spectrum auction in the next six months, according to a parliamentary standing committee report issued on 8 February. The Centre, which recently concluded the sale of 4G airwaves, did not include bands (3,300-3,600MHz) earmarked for 5G in the auction.

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Published: 10 Mar 2021, 08:20 PM IST
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