Indian Reprieve for Chinese Vendors

2:25 PM -- The Indian government has finally buckled under pressure to lift the "ban" on Chinese network equipment that was imposed due to perceived security risks, and which has been impinging on procurement strategies. (See BSNL Blocks Huawei, ZTE Bids, ZTE Embarks on Indian Charm Offensive, Huawei Seeks Talks Over Indian Lockdown, and India's DoT Denies Blanket Ban on Chinese Gear.)

India's operators can now purchase technology from such vendors as Huawei Technologies Co. Ltd. and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763), with prior clearance from the Ministry of Home Affairs. There are conditions, though. The equipment ordered either has to be approved by independent international security audit firms, or it can be self-certified by the network operator, reports The Economic Times.

The self-certification involves the provision of a bank guarantee to the government, which has to be forfeited if any security problems occur once the equipment is deployed, so it carries more potential financial risk.

Both of these options are stop-gaps while a testing lab is set up in India by the country's National Informatics Centre.

The government decision will come as a relief to Huawei and ZTE, which have seen orders for their technology blocked since February this year. They have, though, been receiving support from the carrier community while they lobbied the government for a lift on the trade restrictions, while the Association of Unified Telecom Service Providers of India (AUSPI) asked the Telecom Regulatory Authority of India (TRAI) to include Huawei and ZTE in discussions issues related to 2G spectrum pricing and allocation.

— Gagandeep Kaur, India Editor, Light Reading

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