“We have called around 100 companies, both local and global, including those participating in the production linked incentive<\/a> (PLI) scheme for telecom equipment<\/a> manufacturing, for a meeting on May 20. We basically want to understand what products are being made by them,” an official told ET.
The official added that the government wants to hand hold these firms and listen to their problems, so that issues they have identified can be resolved.
There are many small manufacturers and startups involved in the making of telecom gear that do not qualify for PLI equipment scheme due to the low-income threshold, but these firms have shown potential. The government wants to help these firms to gain scale and so that a whole ecosystem of telecom equipment develops in the country, the officials said.
Many PLI participants are also exporting telecom equipment, so the government is looking to provide help to these firms to secure deals in foreign countries.
“We want to help and provide a supportive policy landscape so that telecom equipment manufacturing gains pace in India,” said another official.
In recent years, the government has been pushing for self-reliance in the telecommunications sector prompted by national security concerns. The political and military face-off with China has led to Chinese firms such as Huawei<\/a> and ZTE<\/a> being effectively kept out from India’s 5G rollouts, and stiff conditions have been imposed on others.
Besides hardware, the thrust is to develop software as well. The development of 4G and 5G stacks have been one of the top priorities of the government as the country not just wants to become self-sufficient in telecom equipment manufacturing but also aims to be an exporter, competing with the likes of Sweden’s Ericsson, Finland’s Nokia<\/a> and South Korea’s Samsung.
To help achieve this, state-run Bharat Sanchar Nigam Ltd (BSNL) has been asked to roll out its 4G network utilising the locally developed 4G and 5G India stack.
Communications minister Ashwini Vaishnaw said recently that India was in talks with 18 countries across the world that are keen to implement the 4G-5G technology stack.
To achieve its goals, the DoT had notified the PLI scheme for telecom equipment manufacturing with an outlay of Rs 12,195 crore spread over five years on February 24, 2021. A total of 42 firms, including 28 medium and small enterprises (MSMEs), have been selected under the scheme and they have made a total investment commitment of Rs 4,115 crore.
The scheme offers incentives in the range of 4% to 7% for different categories and years. For MSMEs, a 1% higher incentive is proposed in year 1, year 2 and year 3.
In April 2022, the scheme was amended to facilitate design-led manufacturing with an additional incentive rate of 1% over and above existing incentive rates, for which 17 firms have applied. Further, additional telecom and networking products were added in the list of eligible products.
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