Open out Telecom Manufacturing sector

Open out Telecom Manufacturing Sector

 By Abraham Paul MD & CEO, Future Groups (India), FCOMNET (U.A.E) 

Till some time back, it took few years to get a telephone connection.  While every industry struggle to build a market volume, the incumbent monopoly strangled the market potential by making plans for minus five year's need and took another five years to sell it. Look at the change in the sector. Now one can step into any pan shop and walk away with a   ready to use phone. The cost of usage also become affordable to common man.

Then look at  the pathetic state of Telecom manufacturing sector like ITI and others in this country. In spite of exploding maket potential in equipment, devices and accessories within the country and abroad, the manufacturing industry in India refuse to grow even with mammoth networth and abundanat highy skilled work force compatible to any in the world. 

Succumbing to various pressures, opening out of the Telecom manufacturing sector is delayed. It is not necessay to link this with BSNL going public. Privatisation of labor intensive BSNL will rake up many issues.  Whatever said and done, private sectors lack the will to harmoniously manage such huge and mostly redundant labor force.   

Scope of getting investment in telecom industry without BSNL's involvement do not seem to be difficult, because many telecom service providers are running helter-skelter with surplus cash to grab business, M&A etc., across the world. Many foreign companies are also looking  for investment in telecom sectors in India.    It is for the government to take quick decision to allow and channelize investments to industrial sector.

There shall be safe guards: The investments are likely to come from companies from which the imports are coming now. There is the risk of passing on outdated systems and technology. Life cycle of telecom & IT hardware is becoming lesser, software and middleware need continuous upgrades at added cost.  With fast changing technology, the telecom investment projections go haywire with very low life cycle hardware, and software needing continuous upgrade/replacements and total change.

When FDIs holding majority shares, the indian counter parts will have no bargaining strength. Cost of systems is likely to go up as the present foreign  vendor competition in the sellers market  vanishes. Therefore, in case of foreign collaborators, it shall be made mandatory to transfer technology to their Indian counterparts like what China did.

As far as the question of security issues are concerned, even now all imported systems have on line access by vendors from their foreign facility bases, for diognosis and other engineering purposes. Indigeneous manufacturing and restricting access only from within the country is the only way to safeguard any potential security risk.

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