Exclude Chinese enterprises from 5G construction? Do Indian sheds that care about money spend more?

Mr Chen said it was too early to say whether India would rule out Chinese equipment on 5G. India will struggle to accept a rise of more than 35 per cent over the price of Chinese equipment. In recent days, Indian media reports have repeatedly said that Chinese companies are likely to be excluded from India’s 5G layout.

On August 28th Sun Weidong, China’s ambassador to India, responded to the host’s claim that India had decided not to invite Chinese companies to participate in the 5G test: “I don’t know what you’re saying.” It is understood that last year, the Indian Telecommunications Administration invited enterprises including Huawei to participate in the India 5G network testing. “

Exclude Chinese enterprises from 5G construction? Do Indian sheds that care about money spend more?

In an interview with First Financial News, Chen Jing, a researcher at the Society for Science, Technology and Strategy, said it would be premature to conclude that India would exclude Chinese equipment from 5G. He said India was often sensitive to price issues and it would be difficult to turn completely to European telecoms suppliers in the long run to accept a rise of more than 35 per cent over the cost of Chinese equipment.

Excluding China?

“Huawei has never had any security issues in its operations in India and has offered to sign a ‘no back door’ agreement with India, ” Mr Sun said. It is hoped that India can make an independent, fair and correct judgment and provide an open, fair, transparent and non-discriminatory business environment for Chinese enterprises to invest and operate. “

India changed its rules on foreign investment on July 23rd to require companies from neighbouring countries wishing to bid on government contracts to register in advance and undergo security investigations. The Indian government statement said the decision was made to “strengthen India’s national defense and security.”

India’s land-to-land neighbours include China, Pakistan, Bangladesh, Myanmar, Nepal and Bhutan, a change that means China’s tendency to invest heavily in India, given the country’s investment layout.

News has since emerged that Bharti Airtel, India’s second-largest mobile operator, plans to exclude Huawei and ZTE from the next 5G trials in favour of European suppliers.

Huawei and ZTE have long been suppliers to Barty Telecom, which accounts for more than a third of Theo’s existing network. Bhatti Telecom has previously reduced its reliance on Chinese companies such as China, replacing its suppliers in Rajasthan with Ericsson and planning a similar replacement in Tamil Nadu.

According tomedia reports, a person familiar with the matter said that among Indian telecom operators, Bati Telecom was the most “friendly” to Chinese companies such as China’s Egrote and ZTE, and that the company’s decision to abandon the Chinese company should be a “forced and desperate move” under government pressure.

Sunil Mittal, chairman of Bati Telecom, publicly backed Huawei’s involvement in India’s 5G construction in October 2019. “I’ve been looking at the industry for 25 years and Huawei’s products have done very well over the last 10 to 12 years,” he said. I dare say that at least in the 3G and 4G eras, Huawei’s products were significantly superior to 3G’s and Nokia’s, all of which I have used. “

Jio, India’s largest mobile operator, which is part of TheInshi Group, has submitted two separate applications for 5G trials, one of which will work with Samsung and the other of which will operate separately using its own 5G technology.

At The 43rd Annual General Meeting of Creed Industries in July, Mukesh Ambani, chairman of India’s richest Faithful Industries Group, surprised four people by announcing that Trust had developed a complete 5G solution that could be tested only after the 5G spectrum was within reach.

In an interview with First Financial News, Chen said India’s 5G policy is not isolated, but needs to be observed in the current environment, “especially to note that India’s recent economic situation is not good, the Indian government resorted to nationalist attitude, the public’s attention from the economy to political events, to divert public pressure.” “

The cost is indigestible.

In the 5G trial in India, mobile vendors will bear the full cost of equipment.

Rajiv Sharma, head of securities research at SBICAP in India, said banning Huawei or ZTE would increase the cost of switching to 5G by more than 35 per cent. At a hearing on the construction of 5G networks organised by the Indian government, Bati Telecom has repeatedly said that replacing Chinese 5G equipment with European products could lead to “unbearable costs”.

India uses a lot of Chinese equipment in 4G construction, but until now some mobile operators, including Bati Telecom, have not recovered the cost of building 4G. If 5G uses high-priced European manufacturers’ equipment, it will be harder to recover costs.

In addition, another major concern for India’s mobile operators is that the government has set the price of 5G spectrum too high, and the Telecommunications Regulatory Authority of India (TRAI) has said it hopes to raise a staggering $84bn in spectrum auctions. India’s mobile operators have been calling for lower floor prices and delayed auctions, citing financial and competitive pressures.

On whether India has excluded 5G equipment from Chinese companies, Chen told First Financial that restrictions on Chinese companies in India are not new and have happened many times in the past, “for example, Huawei has repeatedly lost orders in India, but after a burst of public opinion, orders are back.” “

Chen said that although 5G technology has considerable prospects, but India’s construction of 5G is not imminent. He said India’s 4G construction has not yet been perfected, the construction of 5G has plenty of time. According to his experience, When India places telecommunications orders, it will make repeated inquiries to various companies in the hope of winning an optimal price, and it is entirely possible for India to return to Chinese companies in the future if European companies offer too much.

“India is very price-sensitive, preferring to drag on and gain an advantage in price, and I don’t think it’s likely that we’ll get a 35 per cent increase in European telecoms providers directly.” Chen said.