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New security rules for India’s telcos may hit China’s tech giants like Huawei

New security rules for India’s telcos may hit China’s tech giants like Huawei

The Department of Telecommunications on Wednesday amended licensing norms to make it mandatory for Indian telecom companies to procure equipment only from “trusted” vendors in order to avoid any risk to national security.

The norms will come into effect from June 15 and are likely to impact Chinese telecom equipment makers like Huawei and ZTE as Indian telecom companies like Airtel and Vi draw up expansion plans and gear up for rolling out the next generation 5G services. The new rules come amid the tense military face-off with China on the Ladakh border.

“The government through the designated authority will have the right to impose conditions for procurement of telecommunications equipment on grounds of defence of India, or matters directly or indirectly related thereto, for national security. In this regard, the licensee shall provide any information as and when sought by the government,” the rules state.

The US and Europe have already barred Chinese companies from participating in their 5G plans. The US has in fact drawn up a blacklist of around 100 leading Chinese companies that include, apart from the telecom equipment makers like Huawei, top chipmaker SMIC and drone manufacturer SZ DJI Technology.

The US has blacklisted another 58 major Chinese companies which will not be allowed to buy goods or technology from American firms as Beijing is using these companies to build the dragon’s military muscle. Seven subsidiary companies of Aviation Industry Corporation of China (AVIC) figure on the list which has been published on the US Commerce Department website.

American corporate giants General Electric Co and Honeywell International both have joint ventures with AVIC and supply Commercial Aircraft Corporation of China (COMAC), which is spearheading Chinese efforts to compete with Boeing Co and Airbus. Washington wants to cut off such links which enable China to get ready access to goods and technology from leading US companies.

The ban could beyond this list as the Commerce Department has issued an advisory asking all US companies to do their own due diligence as well when dealing with Chinese companies to ensure that they do not have any military ties. It has expanded the definition of “military end-users,” to include any person or entity that supports or contributes to the maintenance or production of military items even if their business is primarily non-military.