Telcos can buy gear only from 'trusted' vendors as DoT tweaks licence norms

The Department of Telecommunications on Wednesday amended licensing norms to make it mandatory for operators to procure equipment only from “trusted” vendors. The norms will come into effect from June 15 and could impact Chinese gear vendors.

“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 designated authority,” the order said.

Under the new rules, equipment companies will have to enroll on a website, which will establish whether the firm is a trusted source or not. Operators can only place orders with gear manufacturers who make the cut into the list of trusted sources.

However, the government is yet to establish who a “trusted source” is. The norms are based on the national security directive on telecom, which was introduced to control the installation of network equipment from non-friendly countries, mainly China.

Chinese equipment makers experienced a backlash from across the world after the US raised security concerns over gear manufactured there.

Under the provisions, the government will declare a list of trusted sources and trusted products for installation in the country’s telecom network. The directive, however, will have no bearing on the existing contracts or annual maintenance contracts as it does not envisage mandatory replacement of existing equipment.

While the government has not barred procurement of equipment from Chinese companies, it amended the general financial rules 2017 to enable the imposition of restrictions on bidders in public procurement from countries that share a land border with India.

Public firms need to scrap tenders if a qualified bidder is from a country that shares a land border with India, including China. This led to BSNL scrapping its tender for sourcing equipment and relaunched the bid only after certain necessary changes. These moves come amid an escalation of tensions between India and China at the Line of Actual Control.