Latest news with #PPP-MII
Time of India
11 hours ago
- Business
- Time of India
Proposed dilution of local content rules may hurt Indian telecom firms, benefit MNCs: GTRI
New Delhi: Major dilutions to local content rules for the telecom sector under the Public Procurement Order could negatively impact Indian firms by giving greater access to multinational corporations (MNCs) in government contracts without manufacturing in India, according to the Global Trade Research Initiative ( GTRI ) . The GTRI in a note further said that the move will benefit major foreign MNCs active in the Indian telecom component industry. Earlier this month, on June 3, the Department of Telecommunications (DoT) initiated a public consultation to revise its Public Procurement (Preference to Make in India) (PPP-MII) Order for the telecom sector. The consultation, open to industry comments until July 3, proposes a series of technical adjustments to the existing local content (LC) framework -- changes that could have far-reaching consequences for the sector's future. "Department of Telecommunications (DoT) is moving to relax local content norms for government telecom procurement -- a shift that could favour multinational corporations (MNCs) like Cisco and Ericsson while undermining Indian manufacturers who have invested in domestic production and innovation," GTRI's note added prepared by former Indian Trade Service Officer, Ajay Srivastava said. It added that MNCs are "lobbying India's Department of Telecommunications (DoT) to ease local content (LC) requirements, as they struggle to qualify as Class-I local suppliers for government telecom tenders." India's current PPP-MII policy, which was first updated in October 2024, mandates that any firm seeking preference in government telecom tenders must meet a minimum 50 per cent local content threshold. Srivastava added in the note that in order to qualify as a "Class-I" supplier and enjoy pricing and selection advantages, firms must demonstrate that at least 50 per cent of a product's value is sourced or manufactured in India which has become a difficult task for MNCs. The PPP-MII policy applies to 36 key telecom product categories -- including routers, ethernet switches, GPON devices, media gateways, customer premises equipment (CPE), satellite terminals, telecom batteries, and optical fibre and cables. Under the current PPP-MII framework, several exclusions apply to the calculation of local content. Imported parts routed through Indian resellers, royalties, overseas technical fees, and refurbished products do not count toward Indian value addition. Design and software work performed in India is permitted, but the value generated is capped, with restrictions in place to prevent companies from inflating LC percentages purely on the basis of R&D activities while continuing to import most hardware components. Srivastava added in the note that global majors are finding it "difficult to meet these thresholds." He further added that the underlying issue is that most of the work performed in India is done on an outsourcing basis for their foreign parent companies. The parent companies retain ownership of intellectual property (IP) and earn the bulk of profits. Highlighting the impact of policy change, GTRI note said that the move will put Indian telecom firms -- who have made long-term investments in Indian-based manufacturing, R&D, and IP development -- at a severe disadvantage. "Such Indian firms would face the prospect of losing market share to foreign MNCs whose products remain largely imported and foreign-owned," the GTRI note added. It further points out that dilution of standards would discourage Indian firms from investing in genuine IP creation, as Class-I status could now be achieved simply through superficial assembly or software wrapping of imported goods. "India's telecom sector would remain reliant on foreign technologies, with little strategic control," the GTRI note added.
India Gazette
14 hours ago
- Business
- India Gazette
Proposed dilution of local content rules may hurt Indian telecom firms, benefit MNCs: GTRI
New Delhi [India], June 22 (ANI): Major dilutions to local content rules for the telecom sector under the Public Procurement Order could negatively impact Indian firms by giving greater access to multinational corporations (MNCs) in government contracts without manufacturing in India, according to the Global Trade Research Initiative (GTRI) . The GTRI in a note further said that the move will benefit major foreign MNCs active in the Indian telecom component industry. Earlier this month, on June 3, the Department of Telecommunications (DoT) initiated a public consultation to revise its Public Procurement (Preference to Make in India) (PPP-MII) Order for the telecom sector. The consultation, open to industry comments until July 3, proposes a series of technical adjustments to the existing local content (LC) framework -- changes that could have far-reaching consequences for the sector's future. 'Department of Telecommunications (DoT) is moving to relax local content norms for government telecom procurement -- a shift that could favour multinational corporations (MNCs) like Cisco and Ericsson while undermining Indian manufacturers who have invested in domestic production and innovation,' GTRI's note added prepared by former Indian Trade Service Officer, Ajay Srivastava said. It added that MNCs are 'lobbying India's Department of Telecommunications (DoT) to ease local content (LC) requirements, as they struggle to qualify as Class-I local suppliers for government telecom tenders.' India's current PPP-MII policy, which was first updated in October 2024, mandates that any firm seeking preference in government telecom tenders must meet a minimum 50 per cent local content threshold. Srivastava added in the note that in order to qualify as a 'Class-I' supplier and enjoy pricing and selection advantages, firms must demonstrate that at least 50 per cent of a product's value is sourced or manufactured in India which has become a difficult task for MNCs. The PPP-MII policy applies to 36 key telecom product categories -- including routers, ethernet switches, GPON devices, media gateways, customer premises equipment (CPE), satellite terminals, telecom batteries, and optical fibre and cables. Under the current PPP-MII framework, several exclusions apply to the calculation of local content. Imported parts routed through Indian resellers, royalties, overseas technical fees, and refurbished products do not count toward Indian value addition. Design and software work performed in India is permitted, but the value generated is capped, with restrictions in place to prevent companies from inflating LC percentages purely on the basis of R&D activities while continuing to import most hardware components. Srivastava added in the note that global majors are finding it 'difficult to meet these thresholds.' He further added that the underlying issue is that most of the work performed in India is done on an outsourcing basis for their foreign parent companies. The parent companies retain ownership of intellectual property (IP) and earn the bulk of profits. Highlighting the impact of policy change, GTRI note said that the move will put Indian telecom firms -- who have made long-term investments in Indian-based manufacturing, R&D, and IP development -- at a severe disadvantage. 'Such Indian firms would face the prospect of losing market share to foreign MNCs whose products remain largely imported and foreign-owned,' the GTRI note added. It further points out that dilution of standards would discourage Indian firms from investing in genuine IP creation, as Class-I status could now be achieved simply through superficial assembly or software wrapping of imported goods. 'India's telecom sector would remain reliant on foreign technologies, with little strategic control,' the GTRI note added. (ANI)
Time of India
15 hours ago
- Business
- Time of India
Telecom policy shift may hit Indian firms: GTRI flags risk from easing of local content rules, warns of MNC dominance
Major relaxations proposed in local content rules for the telecom sector under the Public Procurement Order could undermine Indian manufacturers and favour multinational corporations (MNCs), the Global Trade Research Initiative (GTRI) said in a new report. The Department of Telecommunications (DoT) has initiated a public consultation process, open till July 3, to revise the Public Procurement (Preference to Make in India) (PPP-MII) Order for the telecom sector. The consultation proposes technical amendments to the existing local content (LC) framework that could significantly reshape participation in government telecom procurement. 'Department of Telecommunications (DoT) is moving to relax local content norms for government telecom procurement – a shift that could favour multinational corporations (MNCs) like Cisco and Ericsson while undermining Indian manufacturers who have invested in domestic production and innovation,' the GTRI said in a note prepared by Ajay Srivastava, a former Indian Trade Service officer, as quoted ANI. The PPP-MII policy, updated last in October 2024, mandates a minimum 50% local content threshold for firms to qualify as 'Class-I' local suppliers and gain preference in government procurement. GTRI noted that foreign telecom MNCs are lobbying DoT to dilute these norms as they are struggling to meet the existing criteria for Class-I suppliers. To be eligible, firms must demonstrate that at least 50% of a product's value is sourced or manufactured in India. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Cuối cùng, chơi miễn phí game chiến thuật hay nhất 2025! Sea of Conquest Phát ngay Undo The policy applies to 36 key telecom product categories including routers, ethernet switches, GPON devices, media gateways, CPE, telecom batteries, optical fibre and cables. The policy excludes imported parts routed through Indian resellers, royalties, overseas technical fees, and refurbished products from the local content tally. Although design and software work performed in India is allowed, the value is capped to prevent firms from inflating their LC percentage through back-end R&D while continuing to import most hardware. 'Global majors are finding it difficult to meet these thresholds,' the note said, adding, 'Most of the work performed in India is done on an outsourcing basis for their foreign parent companies. The parent companies retain ownership of intellectual property (IP) and earn the bulk of profits.' GTRI cautioned that easing the LC rules could discourage Indian firms that have made long-term investments in domestic R&D, IP, and manufacturing. 'Such Indian firms would face the prospect of losing market share to foreign MNCs whose products remain largely imported and foreign-owned,' the note said. The think tank also warned that lowering LC standards could promote superficial assembly or software wrapping of imported products just to claim Class-I supplier status, rather than genuine localisation. 'India's telecom sector would remain reliant on foreign technologies, with little strategic control,' the GTRI note added. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
04-06-2025
- Business
- Time of India
DoT to review public sourcing policy
New Delhi: The Department of Telecommunications (DoT) plans to review its public procurement policy (PPP) with preference to Make-in-India (MII) order issued in October last year in a bid to incorporate more products and likely relax local sourcing requirements . The DoT had identified 36 products that must have more than 50% local value addition to be eligible for procurement by the Centre and its affiliated entities. Since 5G products were excluded from the list, it had incorporated an enabling provision to review the products from time to time. As per the DoT's notice issued on Wednesday seeking stakeholders' comments, it proposes to review its PPP-MII order dated October 21, 2024, specifically for aspects concerning the list of products notified under the order, product wise local content (LC) requirement including the ceiling of LC for design, conditions of inputs (including design) to be qualified as LC and criteria for calculating LC for software products. The stakeholders can send their comments within 30 days. "Multiple reports (NITI Aayog, Trai, MAIT, PLI companies, etc) indicate that India's limited component ecosystem poses challenges in achieving 50-60% LC in electronic/telecom products. Recognizing this constraint, the conditions for LC qualification also requires a review," the notice said. Currently, the list of products where the minimum LC has to be more than 50% include routers, ethernet switches, media gateways, customer premises equipment, Gigabyte Passive Optical Network equipment, satellite phones and terminals, optical fibre and cable and telecom batteries. While tightening the norms and pushing for Make-in-India, the government had excluded imported items sourced locally from resellers and distributors from the calculation of LC. Besides, royalties, technical charges paid out of India and supply of repackaged and refurbished goods were excluded from the calculation of LC. In case of public procurement, preference is given to class-1 suppliers. In case, class 1 supplier is not able to supply, class 11 supplier is given a chance. All companies making products under the production-linked incentive (PLI) scheme for telecom equipment would be treated as class 11 suppliers. A class 1 supplier has to have 50% LC while a class 11 supplier needs 20% LC. "Any recommendations for the inclusion of new products or exclusion of existing ones must be substantiated with detailed justification...," the notice said.
