Article:
India’s Cabinet Committee on Security recently approved the establishment of a new National Security Directive for the telecommunications sector. The Union Cabinet also approved the auction of 2,251.25 megahertz of the spectrum at a reserve price of Rs. 3.92 lakh crore.
Background and Audit Process
The Centre mandated all telecom operators to conduct an ‘information security audit’ of their networks. The audit aimed to identify and mitigate any potential ‘backdoor’ or ‘trapdoor’ vulnerabilities that could be exploited for unauthorized data extraction or illegal information transfer. A ‘backdoor’ or ‘trapdoor’ is essentially a bug installed in telecommunication hardware that allows for data interception or collection.
Chinese vendors Huawei and ZTE have been globally accused of installing such vulnerabilities and allegedly spying for the Chinese government, leading to their ban in several countries. Approximately 30% of Bharti Airtel’s network and 40% of Vodafone Idea’s network are composed of equipment from these Chinese vendors. State-run firms Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) also utilize equipment from Chinese vendors in their 3G and older networks.
Vendor Participation and Policy Changes
All vendors, including Huawei and ZTE, were initially permitted in the 5G trials. However, geopolitical tensions like the Galwan Valley Standoff in Ladakh made their participation challenging. Consequently, the government forbade BSNL and MTNL from using Chinese equipment for their 4G networks.
While the Department of Telecommunications suggested guidelines preventing private telecom companies from using Chinese equipment, no such mandates have been issued yet.
National Security Directive: A New Approach
The new National Security Directive aims to classify telecom products and sources into ‘trusted’ and ‘non-trusted’ categories. The decision will be based on the approval of the National Security Committee on Telecom, headed by the deputy National Security Advisor. This committee includes members from various departments and ministries, independent experts, and two industry members.
The National Cyber Security Coordinator is the authority designated to establish the methodology to determine trusted products. Products from sources declared as trusted and meeting the Department of Telecom’s preferential market access policy criteria will be certified as India trusted sources.
Significance and Implications
The directive empowers the government to periodically release new guidelines for effective monitoring and control of network security. The increased scrutiny could tighten restrictions on Chinese telecom equipment vendors, hindering their supply to Indian telecom companies.
Mobile applications with either Chinese origins or central servers situated in China may face significant hurdles to re-enter the Indian market. Since June 2020, over 200 Chinese applications have been banned in India due to national security concerns.
The Telecom Spectrum Auction Explained
Spectrum bands of 700MHz, 800MHz, 900MHz, 1800MHz, 2100MHz, 2300MHz, and 2500MHz will be offered for a 20-year duration in the upcoming auction. Winning the right to use spectrum through the auction will allow incumbent telecom service providers to augment their network capacity.
Contrarily, new players could leverage this opportunity to initiate services. Given that the current per-operator spectrum holding in India is below the international average, further spectrum auctions are necessary to achieve optimality.
Spectrum auctions provide an open and transparent method of spectrum assignment to successful bidders. By increasing the availability of spectrum, the quality of telecom services significantly improves. Emphasizing the strategic importance of the sector, it must be added that the telecom sector today plays a vital role as a key infrastructure provider, contributing substantially to economic growth, employment creation, and the expansion of Digital India.
