Broadband Blog

How can the Chnese afford to quote such low rates for the telecom equipment? I had earlier explored the “mystery” behind the same- the entry of Chinese or for that matter any other foreign telecom equipment maker, is not really welcome.

Sunil Jain has raised a valid point in Business Standard( subsequently on Rediff) about the way Huawei has been able to quote one seventh of the cost of the tender prices than it’s competitor’s. There are two things that are lost in the din of the media:

1) It is an excellent oppurtunity for BSNL to kick start the manufacture of it’s own telecom equipment. It could help to shore up revenues in case it needs to set up consultancy services; notably South African nations. VSNL has entered in private partnerships with some companies there- that continent is welcoming more direct investment from Indian companies. Plus of course, the savings that it can accrue from in house capability.

2) Chinese telecom manufacturers are keen to capture the markets at any cost- of course backed by “fanatical” Chinese government, that seeks to subsidise these companies on a massive scale. They seek entry in critical aspect of Indian infrastructure-Telecom. Is it not that this company based in Bangalore was criticised for espoinage in India? My memory fails me here.

I hope that better sense prevails here. Though I really doubt.