Indian mobile operators will be forced to buy security-sensitive telecom products from domestic equipment makers under new guidelines. The new guidelines, if implemented, will have a negative impact on foreign telecom equipment makers such as Nokia, Nokia Siemens, Ericsson, ZTE, Huawei, Alcatel-Lucent, Cisco, Samsung, etc.
The department of telecommunications (DoT), according to a report in Economic Times, will amend license conditions of mobile phone companies under the Indian Telegraph Act to make it legally binding on them to buy security-sensitive telecom products from domestic companies.
The final preferential market access (PMA) policy document added cell phones, tablets, notebooks, netbooks, desktops, monitors, photocopiers, scanners, smart cards, storage USBs and memory cards as electronics deemed security sensitive products.
In addition, telecom network equipment such as 2G/3G base stations, ordinary SIM cards, access routers, DWDM based network transmission gear, GPON devices, microwave radio systems, network management systems, billing software to 4G broadband network and Wi-Fi wireless systems are also security sensitive items.
Earlier, both the Cellular Operators Association of India (COAI) and the Association of Unified Service Providers of India (AUSPI) raised objections to local sourcing policy. Their main point was that India does not have a strong telecom gear manufacturing ecosystem in India.
DoT also wants to extend PMA compliance to private sector telecom gear procurements to check India’s telecom gear import bill, which has increased nearly 34 percent to Rs 56,421 crore in 2012-13 from Rs 42,249 crore in 2009-10.