As govt mulls easing norms for local telecom gear makers, GX Group flags import surge risk

A senior official from GX Group has stated that easing value-addition regulations for locally-made telecom equipment without adequate safeguards could increase the risk of imports from unreliable sources.

The Department of Telecom has initiated a reassessment of local value-addition standards in telecom equipment after reports indicated that manufacturers struggle to meet the 50-60 percent local content requirement in electronic and telecom products because of a restricted component ecosystem in the nation.

The action occurs as the government has launched a ₹23,000-crore scheme for manufacturing electronic components to boost local value addition in domestically produced electronic items.

“The consideration of a review to local content norms is a welcome move, however, relaxations need to come with caution on specific components.

“Reducing value addition without utmost caution can enhance risk of increase in imports from non-trusted nations,” GX Group CEO Paritosh Prajapati said .

GX Group is a beneficiary under the telecom sector’s production linked incentive scheme.

The company has its manufacturing facility in Manesar and a research and development centre in Chennai.

“The security-sensitive telecom equipment segment is already being infested from imported products, which is mitigating growth of indigenous production under telecom PLI scheme,” Prajapati said.

The DoT on June 3 invited comments on the review of the Public Procurement from industry bodies -VoICE, TEMA, ICEA, COAI and MAIT, original equipment makers Tejas, VVDN, HFCL, Nokia, Ericsson and CISCO.

It has also sought feedback from electronics manufacturing services firms Dixon, Syrma, Neolync, and Jabil, along with public sector companies such as BSNL and TCIL. The DoT has provided stakeholders with 30 days to share their feedback.

Prajapati mentioned that GX Group and other industry players have devoted their full attention to indigenisation requirements and have developed a strong local manufacturing framework along with domestic R&D and IP rights in recent years.

He mentioned that since the Indian component sector is still expanding to some extent, easing the regulations could provide some support to the industry for certain components only to help Indian companies become more competitive. He mentioned that there are cases where global companies enter the market but focus on assembling products instead of developing products and adding value, which means they are not investing in the local economy but are solely prepared to meet market demands and increase profits.