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With 85 million telephone connections, an annual turnover of nearly Rs. 60,000 crore and providing employment – both direct and indirect – to about 50 lakh persons, the telecom sector has achieved great significance. There are enough reasons to indicate that the growth rate in this sector will be a long-term phenomenon and considerable potential for a rapid growth both in the urban and rural sectors. The Minister of Communications & Information Technology, Shri Dayanidhi Maran said this while he was delivering the inaugural address at the Round Table Conference on Development of Telecom Equipment Manufacturing Sector, here today. Shri Maran expressed his ambition and urged the Telecom Equipment Manufacturers to work together so as to achieve a target of 250 million, if not at least 200 million telephones by the year 2007.
Shri Maran further said that the major telecom equipment manufacturers, all over the world, lead the telecom service providers to introduce new products and technologies and upgrade their networks constantly so as to provide more and more value added services. Whereas the tendency in India has so far been tailor-made to suit the requirements of the service providers. Therefore, a paradigm shift needs to be brought about, he said. The Minister reminded the telecom equipment manufacturing sector to be more competitive to face the growing challenges in the light of WTO’s Information Technology Agreement which envisaged zero duty by the year 2005. In order to make a good start, the Government has modified the Electronic Hardware Technology Park (EHTP) Scheme by which provides for import of raw materials at zero customs duty and sale in the domestic tariff area is treated as deemed export thereby leaving the challenge before the manufacturing companies as to whether or not they could give the required edge to indigenous manufacture.
Speaking on the occasion, Dr. Montek Singh Ahluwalia, Dy. Chairman, Planning Commission, said that the protective approach is not conducive for the growth of telecom sector and suggested the need for correction in the duty structure in telecom manufacturing sector. He further said that effective restructuring is critical to promote indigenous telecom manufacturing in the country. Dr. Ahluwalia assured that the Planning Commission would work to provide requisite support in that direction.
In his key note address Shri Nripendra Misra, Secretary, Department of Telecommunications, said that most of the foreign manufactures based in India resorted to import and supply route with the further liberalisation of Telecom Policy and opening up of imports, with the result the foreign companies started operating as trading companies. Shri Misra further said that despite major policy initiatives like abolition of licence regime, rationalisation of custom duty, incentives under EHTP Scheme, etc., the growth rate has been near static or even negative in the last few years. The Secretary pointed out two critical messages which are treating incumbent operators as captive markets led to local manufactures completely ignoring the R&D and value addition and the Indian manufacturers did not plan for the growing telecom boom in the emerging economies. With a vibrant market fuelled by the demand both from public and private sector, it is perhaps necessary to explore the nature of implicit support both from the Government and the private operators thereby providing access to the domestic market, Shri Misra said. He suggested the manufacturers to consider the nature of level-playing field in procurement, incentives and reservations for expanding domestic consumer base. Shri Misra cited Chinese strategy which is based on the domestic market and strongly oriented to the global through state-of-art technology and services.
While the first half of one-day session of the Round Table Conference on Development of Telecom Equipment Manufacturing Sector included prominent speakers from various telecom equipment manufacturing companies around the world, the second half was followed by Technical Session and Group discussion. The session was concluded with the valedictory address by the Minister of State for Communications & Information Technology, Dr. Shakeel Ahmad.
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