Indian Telecom Industry and Self Reliance
August 23, 2020
The ownership of a robust communication system lies on consumers who should demand no compromise on quality and on suppliers who should make it available at the cheapest cost for the best quality. — Alok Singh
Self-reliance is the mantra of survival in all civilisations. The communication quality is the most important and the earliest mirror of any civilization. Richer the civilization, more robust is the language or method of communication. Nature communicates, the animals communicate and the humans also communicate. The communication has evolved too much- from sign language to machine level language, from the application of wired to wireless technology, from delayed delivery speed to match the speed of light, and is still continuously evolving. Perfect communication is the business principle of reducing wastage and attaining efficiency as well as productivity. If the perfect message is killed the communication is a failure.
The telecommunication is the accepted infrastructure of doing businesses in the contemporary world. Whether it is conducting financial transactions or imparting education or monitoring participation or quantifying value addition or any business which can be named, there is a role of communication. It’s no more just a simple replacement of postcard or landline telephone. It’s not about faster delivery rather it’s about perfect delivery and at the same time real-time delivery. If the delivery is delayed the communication is a failure. If the messages are tempered then it’s a communication failure. If the message is reaching late then it’s also a communication failure. If the message is reaching to someone who is not supposed to be informed then it’s a communication failure. If the message is not reaching in real-time to whomsoever it is supposed to reach then it’s a communication failure. So, communication needs to be perfect, tamper-proof, and real-time. Hence it has an important constituent of security. It involves the security of the businesses, the security of the nation, or security of planning any strategy.
The share of Chinese communication devices in the Indian market is something to be explored for personal interest, for business interest and for the national interest. The share of Chinese devices is an intrusion or infringement or encroachment or just another item to provide us convenience. Is it the price or the capability or government policy?
If it is price then it’s worthless to compromise on the price for the sake of security. If there are tradeoffs between safety-security and price then it’s obvious that price has lower pecking order among all objects of safety-security-price. That’s the principle based on which the insurance company runs their business- price versus risk; higher the risk so higher is the insurance premiums. The price is paid for quality and quality is subjective in nature. For someone, timely delivery is quality, for others, the product features are quality, for someone the post purchased service is quality, and so on. Standalone quality is difficult to judge. Quality is comprehensive and people need to understand it.
We have learnt it hard way during Doklam crisis when the Chinese communication devices suddenly didn’t work in favour of its owners i.e. for our soldiers. Nowhere anyone can say that safety-security is lower in the pecking order with reference to price. The users of telecommunication devices need to be made aware of the security issues and the tradeoffs which they are making with price by compromising their security. It can be of immediate or short term or long term disadvantage. The unaware customers in general and the end-user in particular need to be educated about the tradeoffs of price and safety-security while purchasing a telecommunication device.
The capability is owned by us. We are capable enough to match anyone including Chinese. We have demonstrated that during the Covid-19 crisis itself. The government of India banned 59 mobile-based applications of Chinese origin and within no time we are flooded with alternatives of domestic applications to do the job with the same level of ease but with robust security features. The nation responded with the same speed in accepting domestic applications.
There are a plethora of examples in mobile applications. The concern is the hardware component of the telecommunication devices. The printed circuit board is an important constituent of mobile phone device and it is the most important value addition, comprising more than fifty per cent of value to the device. The printed circuit board fabrication is a high-end technology and it’s not about capability but about the opportunity. There are a lot of Indian companies capable to do fabrication of printed circuit boards but the price pressure and lack of government orientation in supporting the fabrication of printed circuit board is the culprit. It’s not about capability rather it’s about commitment. Many private players in telecommunication business with a deep pocket are serving the national interest by launching newer and newer substitutes for Chinese products.
The policymakers are rising to the occasion in a giant way. The government demonstrated its agility in banning the Chinese applications as well as promoting ‘vocal for local’ at a mass level. The Indian manufacturers are planning in a big way to substitute the Chinese hardware businesses in the telecommunications sector. The tenders are being cancelled, the 5G is being postponed and the publicly owned companies in the telecommunications sector are on a revival path. The policymakers are rationalizing the trade policies, and are plugging the holes in the customs duty and other import-related taxes. At the same time, it is expected from the government to stimulate the manufacturing of most valuable component of the hardware part of the telecommunication devices in favour of the domestic manufacturers. There is an urgent requirement to work on fabrication unit for printed circuit boards.
The profile of the telecommunication sector has changed. It’s related to the national interest, it’s related to an individual’s privacy, it’s related to data localization and it is related to all the businesses, as well as related to other characteristics of operations management like efficiency, productivity, agility, privacy, mass access and a lot more. The new Bharat is an aspiring Bharat. The whole world is looking at us for business policy, trade policy, health policy, fundamental research as well as applied research and waiting to see us emerge as an alternative to the global value chain. It’s no more about ‘us’ only but it’s about ‘all of us’ the whole new world. The ownership of a robust communication system lies on consumers who should demand no compromise on quality and on suppliers who should make it available at the cheapest cost for the best quality.
Alok Singh is fellow of Indian Institute of Management Indore and currently is faculty of general management at NICMAR.