The Hindu : Business : Maran for selective imports to revive telecom sector

Online edition of India's National Newspaper
Tuesday, Sep 14, 2004

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Business

Maran for selective imports to revive telecom sector

By Our Special Correspondent

NEW DELHI, SEPT. 13. Acknowledging the neglect of the Indian telecom manufacturing, the Communications and Information Technology Minister, Dayanidhi Maran, today wondered whether selective imports could help revive the sector.

"We should take a hard look and see if service providers can confine imports only to those items that cannot be manufactured in this country. A sense of social obligation must pervade the operations of service providers without affecting the quality of service and balance sheets. Simultaneously, we should also ask ourselves as to why cannot we manufacture equipment such as routers, and soft switches to world class quality at competitive prices," he said. Mr. Maran was speaking at a conference on development of telecom equipment manufacturing sector which was also attended by the Planning Commission Deputy Chairman, Montek Singh Ahluwalia, Telecom Secretary, Nripendra Misra, and leading telecom equipment manufacturers.

Pointing out that indigenous manufacture of telecom equipment was an element of New Telecom Policy `99, he admitted that over the last few years this aspect could not be adequately realised although in terms of volume, there was adequate justification for the establishment or improvement of the manufacturing facilities in India. Besides, there was the additional market in the Asia Pacific region. But the value of the present manufacturing in India was not even a small fraction of the investment on equipment.

It is not as if India lacked manufacturing capabilities. Not long ago, the Centre for Development of Telematics developed rural exchanges that brought down the price of switching equipment. A major share of the telecom equipment involved software for which India is well equipped. With these strengths India had been unable to establish a good manufacturing base. "Is it because, unlike neighbouring China, we did not insist on indigenous manufacture or is it because of the manner of procurement of our service providers?" Mr. Maran wanted to know.

As one constraining factor could be the time taken for R&D to be translated into commercial production, Mr. Maran wanted Indian telecom equipment manufacturers to tie up with the best R&D centres in the world to beat technological obsolescence. Simultaneously, efforts should be made to improve indigenous R&D too.He felt that the telecom equipment manufacturers' concerns should be seriously deliberated. At the same time efforts should be made to attract companies such as Motorola, Alcatel and Nokia to set up manufacturing base in this country. The Government had recently constituted a Core Group on Infrastructure and telecom had been identified as a priority sector. With Dr. Ahluwalia and the Union Finance Minister, P. Chidambaram, among others, being on the Core Group, Mr. Maran was confident that the Planning Commission and the Finance Ministry would give full and purposeful consideration to the various measures required to make the indigenous telecom equipment industry vibrant. He appealed to the telecom manufacturing industry to submit its recommendations to the Core Group, which would seriously consider its requests.

Dr. Ahluwalia assured the gathering that the Planning Commission would consider steps to revive the Indian telecom equipment manufacturing sector.

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