BSNL, MTNL cancel 4G upgradation tender aimed at keeping China's Huawei, ZTE out of India's telecom sector

Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telecom Nigam Limited (MTNL) have cancelled tender inviting bids from companies for supply of equipment for upgrading its network to 4G – a move, which is apparently aimed at keeping away Huawei and ZTE Corporation of China away from the project and stopping them from expanding footprints in India's telecom sector.

The decision by the two state-owned telecommunication service providers comes amid the continuing military stand-off between India and China along their disputed boundary in eastern Ladakh. New Delhi is also likely to review its December 2019 decision to allow the Huawei and ZTE to take part in the 5G trial in India.

The US Federal Communications Commission (FCC) on Tuesday designated the Huawei and ZTE and their parent and subsidiary companies, as well as affiliate firms, as “national security threats”. The companies were earlier accused of spying for the Chinese Government.

The US has been nudging New Delhi to keep the two Chinese companies out of the 5G roll out in India.

India on Monday banned 59 apps linked to China, alleging that they were used in activities “prejudicial to sovereignty and integrity of India, defence of India, security of state and public order”.

The tender was issued on March 23 for planning, engineering, supply, installation, testing, commissioning and annual maintenance of the 4G mobile network in the North, East, West and South zones of BSNL and Delhi and Mumbai License Service Area of the Mahanagar Telecom Nigam Limited (MTNL) on turnkey basis. The state-run telecom company now issued a notification to cancel it. A fresh tender is likely to be floated within two weeks after a panel of expert comprising BSNL and Department of Telecom officials submit the report.

The revised tender may exclude the companies of the neighbouring communist country from participating in the process.

The BSNL tender was to upgrade 49,300 sites to 4G and the addition of 7,000 new sites in two metropolitans-- Delhi and Mumbai for Mahanagar Telephone Nigam Limited (MTNL).

The Chinese telecom major ZTE and Huawei which already supply equipment to Indian telecom firms were eyeing a major part of tender.

In the wake of the military stand-off between India and China in eastern Ladakh, New Delhi already asked the BSNL to reduce the dependence on Chinese telecom companies in its 4G network.