Raja meets HM; seeks review of policy on Chinese equipment

home ministry comments indicate procurement from Chinese firms is not recommended

PTI | May 26, 2010



Concerned over delays in procuring equipment, particularly from Chinese vendors, Telecom Minister A Raja today met Home Minister P Chidambaram and sought a review of the policy so that sector's growth is not hampered.

The meeting comes in the wake of home ministry' comments indicating that procurement from Chinese firms is not recommended.

There are apprehensions in the industry that such an order or a blanket ban on Chinese equipment could hamper the growth of the entire sector, Raja is understood to have told Chidambaram.

"I shall be grateful if you could kindly review the whole issue and lay down procedure in a manner so that the growth of telecom sector is not hampered," Raja said in a letter, which was handed over to Chidambaram.

The security agencies had expressed reservations on allowing the Chinese companies in telecom and information technology citing the incidents of Chinese hackers targeting sensitive data on government web sites.

Two Chinese firms ZTE and Huawei have been doing telecom business in the country for many years and have supplied equipment to various private operators as well as government- owned BSNL and MTNL.

The representatives of both companies have met the government officials and explained and offered to take any step to ensure that there was no security threat from them.

According to Raja's letter to Chidambaram, the foreign vendors have also raised concerns saying the stand was inconsistent with India's commitments to intellectual property rights in multilateral forums such as WTO.

"Chinese companies/firms and Chinese Embassy have raised issues about their business interest in India referring to sensitive and delicate state of India-China relations," the letter said.

As suggested by the ministry of home and security agencies with regard to security concerns over procurement of telecom equipment/software by service providers from foreign vendors, the DoT had issued amendments in licences in December 2009 to obtain security clearance before placement of purchase orders.

This has been causing inordinate delays in procurement of equipments and the private operators have complained to the DoT and are seeking review of such policies.
 

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