Licence Raj set for comeback

Telecom, broadcast gear may need permit,

The government may expand the scope of business activities that require an industrial licence to include communications network management equipment, among other items.

The national security establishment has mooted a suggestion to bring this category of equipment and its manufacturers under the purview of the Industrial Development & Regulation Act, 1951.

It has also stressed the need for amending the existing communications licences, and introducing specific security-related clauses.

The proposal will have ramifications for the burgeoning telecom and broadcasting industry, which is expected to sell equipment worth over $8 billion in the coming months alone, with orders spread over companies like Motorola, Nokia, Ericsson, Alcatel and, possibly, Chinese firms like Huawei and ZTE.

The suggestion to extend the requirement for an industrial licence to this sector is aimed at ensuring that no item imported or manufactured in India by a global company, or its Indian joint venture, is denied for use in strategic sectors under some pretext "" like the dual use restrictions imposed in the past.

Since this suggestion will have wide-ranging repercussions, the security establishment has called for a larger debate involving various departments and agencies, including the department of space, Defence Research Development Organisation, department of atomic energy, Ministry of External Affairs, Ministry of Defence, and intelligence organisations.

Citing India's concerns regarding foreign acquisitions, and suggested counter-measures, the establishment has said there is a need to "guard" against "extra-territorial" application of foreign laws, that could adversely affect India's domestic and foreign trade, particularly in the strategic sector.