The Department of Telecommunications (DoT) has the power to bar Chinese firms that operate in the telecom equipment market from participating in various tenders that are floated by state run companies and Central and State Governments. The notification has been issued by the government on 20th February, 2020. This comes amid the visit of the US President Donald Trump who is set to visit India in the next few days. The President had claimed that the Chinese telecom equipment suppliers pose a national security risk. USA has further pressed it's allies to ban the companies from participating in 5G networks.
The following move is set to hit Chinese suppliers such as Huawei, ZTE and UTStarcom that will likely be barred from participating in government projects from now onwards. Government projects in India have been using telecom gears in areas like railways, smart cities, mission and state government fibre connectivity projects - BharatNet.
The DoT letter addressed to the Government (Central & States) departments and public sector units as dated on 19th February, 2020 states the provision of clause 10 (d) of Public Procurement (Preference to Make in India) Order 2017 can be invoked in relation to certain telecom against any foreign government that does not allow the Indian suppliers to participate and/or compete in procurement of telecom equipment."
The items listed in the letter include - Optical fibre, 2G/3G/4G/LTE Modems, routers, WiFi based broadband access system and GPON equipment.
This decision comes at a time when India is getting herself ready to roll out a 5G services across the country. Analysts have stated that this move to bar Chinese companies will likely hurt India.
"Chinese companies are the most price competitive in the industry," said Mahesh Uppal, Director of communications consulting firm ComFirst India. Competition between countries should be played out elsewhere. It would have been better if it could be done without impact on the Indian digital dream."
Author - Dyuti Pandya
