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Domestic telecom equipment makers raise complaints about unfair practices in the industry

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In Short:

Local telecom equipment companies are concerned that the bidding conditions for the Rs 65,000-crore BharatNet phase III initiative could hinder India’s self-reliance goals. They feel that the 50% local value addition requirement for both active and passive components could favor multinationals, impacting local companies. The industry group has petitioned the government for intervention and suggested exemptions to encourage smaller players in the bidding process.


Homegrown Telecom Equipment Companies Raise Concerns Over BharatNet Phase III Tender

Homegrown telecom equipment companies, led by the Voice of Indian Communication Technology Enterprises (Voice), have expressed concerns about the bidding conditions of the BharatNet Phase III initiative. The bidding conditions mandate a 50% value addition of active and passive components locally, which the companies believe goes against the spirit of the Atmanirbhar Bharat initiative.

Background

Last month, state-controlled Bharat Sanchar Nigam Limited (BSNL) issued a tender for the BharatNet Phase III program, aimed at providing last-mile connectivity and upgrading existing gram panchayats. The initiative, backed by the Universal Service Obligation (USO) fund, requires bids to be submitted by April 2, 2024.

Concerns Raised

Local companies such as United Telecoms Limited (UTL), Tejas Networks, Nivetti Systems, and others have raised concerns about the 50% local content requirement in the tender. They believe that certain clauses in the tender could lead to undue benefits for implementing entities deploying imported equipment.

The group representing these companies has petitioned the Prime Minister’s Office and the Union Minister of Communications seeking intervention to address these concerns.

Call for Implementation of Make in India Policy

The group has emphasized the importance of implementing the Make in India policy for the BharatNet Phase III project. They suggest that a local design and manufacturing-led approach should be followed to ensure compliance with the policy’s principles and objectives.

Key Recommendations

The group has recommended exempting mandatory deployment experience to encourage smaller players and allowing only OEMs or Class I suppliers to participate. They also highlight the need for policies similar to those adopted for the BSNL 4G project for the BharatNet Phase III expansion.

Industry Experts’ Views

Experts in the industry have pointed out challenges faced by Indian domestic firms in accessing markets, both domestically and overseas. They highlight the need for a level playing field and fair competition.

Tender Details

BSNL has received over 3,000 queries from prospective bidders for the BharatNet Phase III initiative. The tender allows for single entities or groups to bid, with certain financial criteria to qualify.

Overall, the concerns raised by the homegrown telecom equipment companies underscore the need for a balanced approach to promote local manufacturing and support the Atmanirbhar Bharat initiative in the telecom sector.

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