Trai to assess India's potential in manufacturing local telecom equipment

Trai had floated a consultation paper on the subject in December 2010

Telecom regulator Trai on Monday started second phase of consultation process to promote use of locally manufactured equipment in the domestic network.

The Telecom Regulatory Authority of India had floated a consultation paper on the subject in December 2010 and issued recommendations on the same in April 2011.

"In the last five years, there has been an exponential growth in technology in the telecom sector. A need has therefore been felt to revisit the issues of 'Promoting Local Manufacturing in Telecom Sector'. In light of the above, the authority has suo motu decided to issue a consultation paper on 'Promoting Local Telecom Equipment Manufacturing'," Trai said in a statement.

The consultation paper will also discuss the controversial issue of standard essential patents and grant of their licence for use on the basis of fair, reasonable and on-discriminatory (FRAND) terms. It has been a bone of contention between domestic mobile phone companies and European multi-nationals.

The regulator said it aims to realistically assess India's true potential in equipment manufacturing with the aim to frame recommendations to transition Indian telecom industry from an import-dependent industry to a global hub for manufacturing.

Trai added that the mobile handset manufacturing industry showed good progress in the past five years, but telecom equipment manufacturing companies have not been able to catch up.

According to Law and IT Minister Ravi Shankar Prasad, 93 companies in the mobile phone segment have started making products in India.

"Today, the services sector commands nearly 60 per cent of India's gross domestic product (GDP) whereas the share of manufacturing, a major contributor to the infrastructure domain, has been stagnating at around 16 per cent on average since 1990," the regulator said.

Trai cited a report which showed that over 90 per cent of the demand of telecom equipment in India was met through imports in 2013-14.

In the consultation paper, Trai has invited public views to identify policy measures required to boost innovation and productivity of local telecom manufacturing in India, examine the existing patent laws in the context of promoting local manufacturers and current fiscal incentives to promote local telecom manufacturing and recommend measures for implementation in future and the like.

Last date for comments on the consultation paper is October 16 and counter-comments, if any, October 30, 2017.