Nearly 75 percent of the telecommunication system is sourced from and provided by two major players — ZTE and Huawei, both Chinese companies.
The tenders for up-gradation of the 4G networks are canceled by state-run firms Bharat Sanchar Nigam Ltd’s (BSNL) and therefore the Mahanagar Telecom Nigam Limited (MTNL) after the Department of Telecom asked them to not use Chinese gear.
A source aware of the event said that new tenders are going to be floated within the next fortnight will have an emphasis on preference to form in India, and are likely to exclude Chinese companies.
Huawei and ZTE are among the main Chinese-origin telecommunication system makers doing business within the Indian market.
The source said that the govt had told BSNL and MTNL to not use Chinese equipment in a 4G upgrade, days after 20 Indian soldiers were killed during a violent clash with Chinese troops along the road of Actual Control (LAC).
The implementation of the direction meant that the businesses will need to issue a replacement tender. The BSNL tender was worth around Rs 7,000-8,000 crore.
Keeping in sight the developing Indian capacity and in-house technology, new tenders are going to be floated, the source said adding this may have an emphasis on preference to form in India.
The move is a component of the government’s push to scale back reliance on India’s telecom sector on foreign equipment and increase domestic manufacturing. Nearly 75 percent of the telecommunication system is sourced from and provided by two major players — ZTE and Huawei.
According to sources, the govt can also rethink its information and communication technology strategy for the rollout of 5G during which Huawei was slated to require part.
The development comes within the backdrop of India banning 59 Chinese apps, including the likes of TikTok and UC Browser, on Monday due to security and data breach concerns.