In recent developments, the Department of Telecommunications (DoT) has modified the licensing conditions for telecommunications companies. These new regulations kick in from 15th June 2021. The Union Cabinet had previously green-lighted the Production-Linked Incentive (PLI) scheme for the telecom sector in March 2021, a plan designed to minimize imports in favor of domestic self-reliance.
New Licensing Conditions
The primary objective of these revised terms is to prioritize defence and national security when buying ‘trusted telecom products’ or sourcing equipment from ‘trusted telecom equipment sources.’ Under these provisions, telecom companies can only utilize trusted resources in their networks. Additionally, telecom companies have to secure permission from the National Cyber Security Coordinator if they wish to upgrade their existing network with equipment not recognized as a trusted product. However, these new rules won’t affect annual maintenance contracts or upgrades to equipment currently being utilized by the telecom operators.
Defining Trusted Telecom Products/Trusted Telecom Equipment Source
In essence, a trusted product or equipment source is determined as such by the government of a nation, considering it safe for use in critical infrastructure. The Cabinet Committee on Security in India approved a new National Security Directive in December 2020 to categorize telecom products and equipment sources into ‘trusted’ and ‘non-trusted’ classes. The National Cyber Security Coordinator has been appointed as the designated authority for this task, with decision-making based on the approval of a committee headed by the deputy National Security Advisor (NSA). The committee also includes members from different departments, ministries, independent experts, and two industry representatives.
The Potential Impact
This updated policy could potentially hinder Chinese telecom equipment vendors like Huawei and ZTE from supplying to Indian telecom companies. Both vendors have faced global scrutiny over allegations of installing vulnerabilities and spying for the Chinese government, leading to bans in several countries.
Significance of the Changes
Telecom equipment plays a pivotal role in connectivity and data transfer, directly impacting national security. Therefore, these changes aim to bolster India’s national security. Moreover, the demand for local equipment will likely increase, further promoting the vision of Make-in-India and Atmanirbhar Bharat.