A new procurement policy has been notified by the Department of Telecommunications (DoT) for the public procurement of items like routers, batteries, satellite Phones, and internet Set-top boxes, among others that mandates the items qualifying for procurement to have minimum local content up to 50%.  

Scope of Policy 

The revised policy would apply to procurement to be made by central government entities ranging from state-run companies to local bodies and also the projects under the Universal Service Obligation Funds. It also includes the autonomous, attached, and subordinate institutions falling under the purview of the government of India up till the states or agencies making procurements under the policies of the central government. 

Exclusion of Items 

The authorities have also come up with a policy to exclude imported items sourced from resellers or distributors from the list of local content. Moreover, as per the new policy, royalties technical charges or refurbished goods too not fall under the category of local content, anymore. 

Listed Equipment 

The 36 products falling under the regime of the policy include media gateways, customer premise equipment, IP-based soft switches, IMS, Unified communication systems, Telecom batteries, and VSAT Hub subsystems, to name a few. 

Categorisation & Prioritisation   

DoT has divided the suppliers into two categories namely Class I & Class II. Class I stands for the suppliers whose goods and services qualify the criteria of 50% while Class II stands for suppliers with 20% local content in their goods and services.  

The Class I suppliers will be given preference in procurements over the Class II suppliers while Class II suppliers will be entrusted with procurement only if the Class I supplier is not able to fulfill the supplies. Additionally, manufacturers covered under the PLI scheme of the telecom sector will also fall under the Class II category. 

Confident of Supplies

The DoT is quite confident with its plans as it finds Indian manufacturers to have sufficient local capacity and competition for the 36 products listed in the policy. The authorities are also of the opinion that the list would be revised from time to time depending upon the suggestions received from the industry. 

Boost to Make in India 

This particular policy is expected to favor Indian manufacturers giving them the much-needed boost to the Indian companies concerned with Electronics Manufacturing Hence in turn it is a big boost for the Make in India initiative of the government of India. 

This would also give the Indian manufacturers an advantage over the foreign companies as India boasts of an ever-expanding telecom sector, with 5G and 6G on the cards, that aim to place it in a leading position in the worldwide telecom ecosystem.