There is a big opportunity may be missed by the hardware companies situated in India, as due to the eligibility norms it cannot participate in the big defence telecommunications project worth 13,000 crore.
The whole Indian Industry wants to participate in the project as this project is basically meant to build a nationwide, secure communication network for the country's armed forces. The project is having the responsibility to run the mobile operator- BSNL (Bharat Sanchar Nigam Ltd.) and this responsibility is given by the Department of Telecommunications.
The rules which are made to govern eligibility to bid for the project create difficulty for the participants to participate, as stated by the Indian suppliers. The qualification criteria towards domestic companies (including government firms) also don’t allow the companies to bid for the project. This is written in a letter to BSNL by Vinod Sharma, chairman of CII's Committee on ICTE Hardware Manufacturing. There is a financial eligibility criteria also which states that the companies must mandate an annual turnover of between 2,500 crore and 4,000 crore during the last three years and in terms of technical criteria or eligibility, as per the rules the companies must have deployed a specified quantum of equipment over a defined period of time. Regarding this eligibility norms and criteria and to remove them or seeking a solution by which they can participate for bidding, several industry lobbies have written to BSNL, DoT and the Prime Minister's Office. It include CII also which makes local companies ineligible to bid.
The development will take place at a time when India will try to save on the import bill and also adding precaution to their security as there is a possibility of compromising of security by using foreign-made equipment, India can save by promoting the local manufacturers of electronic devices.
Like CII, there are some other industry lobbies have also written and asking for the rules to be changed to the Deptt. Of Telecommunication, the Department of Electronics and Information Technology, Kapil Sibal, the minister for Communications and IT and the PMO(Prime Minister's Office). The other lobbies include the Indian Electronics and Semiconductor Association, the Telecom Equipment Manufacturers Association, Elcina Electronics Industries Association of India and the Telecom System Design & Manufacturers Association.
The industry lobbies wants some changes in the rules or in the financial and technical eligibility norms but with this they also wants that preferential market access rules should be introduced in order to raise the prospects of Indian companies. The preferential market access rules had come in for criticism from US industry lobbies during recent trade talks between the two countries.
It is expecting that the dedicated communication network – often called ‘network for spectrum' project will be completed by the year 2015 and by this may be telecommunication airwaves that they are currently using are vacated by the armed forces. Few days back or in the last month, ET send a detailed questionnaire to BSNL but BSNL did not even reply to the same.
The security concerns and stricter rules governing the procurement, has also risen by the Indian Electronics and Semiconductor Association. PVG Menon, president of IESA wrote in his letter to the minister and the PMO regarding the less attention is paid to the security issues which will pose a severe risk to this highly security-sensitive network. It is required that the source code for products that are bid should be resident in India at all times by which same can be accessed at times of emergency.
If you keep source code in the country, then for the multinational suppliers, it is often a deal breaker who cites possible violation of their intellectual property rights to reduce such demands.
The similar concerns are also raised in its December 3 letter senior officials at the defence ministry by the Elcina Electronic Industries Association of India.
There are some foreign equipment manufacturers who have made their significant presence in the Indian telecommunications market include US-based Cisco and Juniper, France's Alcatel Lucent, Nokia Siemens, as well as China's Huawei and ZTE.
