The Narendra Modi government has made a big decision today, shocking the Chinese market by banning the use of their 4G equipment in the Indian telecom sector. In view of national security, the government has today directed the Department of Communications and government telecom companies BSNL and MTNL to stop the use of Chinese equipment for the implementation of 4G.
Since private companies use this telecom infrastructure of BSNL and MTNL too, China is expected to feel a harder pinch.
The government has ordered BSNL and MTNL to abolish all tenders in this regard and the process to withdraw new tenders will be started soon. The government will not give any new tenders for 4G to Chinese companies and fresh tenders will be withdrawn.
The government is preparing a set of instructions to block Chinese equipment by private companies as well. This is a big initiative to reduce Chinese goods’ use in India. As a bonus, the step adds to Prime Minister Narendra Modi’s ‘Atmanirbhar Bharat’ (self-reliant India) campaign launched recently.
On the night of 15-16 June, a violent skirmish took place between the Indian Army and Chinese soldiers in the Galwan Valley of Ladakh region, in which 20 brave soldiers of India were martyred. 43 Chinese soldiers are also reported to have been killed in this conflict, but China has not given any official statement on this.
BSNL was ready already
“This (India-China skirmish) is a strategic matter involving national security, and whenever operators would be asked by the government to shun China-origin ZTE equipment, BSNL will be the first to comply with orders,” a BSNL source said.
Shenzhen-based ZTE’s India business has already shrunk, with BSNL being the largest customer servicing in as many as six service areas, while private players have already reduced their dependence on the Chinese company that also maintains only two circles for Bharti Airtel and five circles for stressed Vodafone Idea.
Early this year, the Chinese company has laid off a substantial workforce to cut operational costs following rising financial pressures.
The market for telecom equipment is Rs 12,000 crore, in which the share of Chinese products is close to 25%. People in this field say that if Bharti companies leave China and import from other countries, the cost will increase by 15%.
Private sector eager to boycott China too
The Confederation of All India Traders (CAIT) has given a call to boycott Chinese products too. Earlier, the confederation had urged the government to take some immediate steps such as cancelling the contracts awarded to Chinese companies immediately and framing rules for withdrawal of investment by Chinese companies in Indian startups.
CAIT national president BC Bhartia and national general secretary Praveen Khandelwal said that in view of the recent developments and China’s consistent attitude towards India, Indian traders have resolved to teach China a big lesson by reducing Chinese imports. He said that even though the traders’ trade is being imported from China, nothing will be ahead of their national interest and they have decided to stand in solidarity with the movement.