Vendors want India gear making costs cut

Dylan Bushell-Embling
telecomasia.net
Vendors reportedly plan to call on India to take action to address the price disparity between manufacturing equipment in the nation compared to China, as the government prepares to mandate that at least 30% of key telecom gear be sourced locally.
 
Ericsson, NSN, Alcatel-Lucent, Huawei and other major vendors plan to bring up their complaints during a stakeholder meeting tomorrow, industry executives told India's Economic Times.
 
One executive for Indian networking vendor Tejas claimed that the return on investment for Indian telecom equipment makers is just 11.9%, compared to 34.4% in China.
 
Some international vendors meanwhile believe that current demand for equipment in India does not justify the investments required to establish such a significant manufacturing presence in India - unless they are then also able to export the majority of gear produced at sustainable margins.
 
The Indian government has been drawing up new laws that would require at least 30% of “security sensitive” electronics products to be sourced locally. As many as 24 categories of telecom equipment and devices will be considered security sensitive.

The norms will apply to public sector procurements, but the government has come under fire by industry bodies by planning to extend the rules to private mobile operators as well.
 
India's Home Ministry is meanwhile getting ready to publish the criteria by which imported security sensitive electronics and networking equipment will be screened.

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