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More than half of BSNL equipment acquired from Huawei, ZTE

More than half of state-run BSNL’s telecom equipment is from Chinese companies ZTE and Huawei, the Ministry of Electronics and Information Technology (MEITY) revealed in Parliament on Thursday. Additionally, more than 10% of all of state-owned MTNL’s to be merged with BSNL network equipment comes from Chinese manufacturers, though it’s unclear whether these manufacturers include ZTE or Huawei.

Huawei and ZTE have been under the scanner in India, given long-standing Indo-China tensions. Although both companies had been allowed to participate in 5G trials, the government reconsidered the decision after border clashes with China in June. In August, the Department of Telecommunications (DoT) told the Parliamentary Committee on IT that the decision to allow the companies in 5G trials would be discussed with the Ministry of Home Affairs. However, Dhotre, told the Parliament on Wednesday that the government had no plans to exclude Chinese companies (such as Huawei and ZTE) from 5G infrastructure contracts.

IT Minister of State Sanjay Dhotre said that the DoT did not maintain data on where telcos get their equipment, as long as they adhere to security provisions given in their licenses. However, the telcos had provided the following information to them:

  • In state-run BSNL, 44.4% of mobile network equipment comes from ZTE; another 9% comes from Huawei. This mean more than half of the company’s equipment (53.4%) comes from the two controversial companies.
  • In the Mahanagar Telephone Nigam Limited (MTNL), 10% of the audit / equipment comes from Chinese manufacturers
  • Reliance Jio Infocomm Limited told the ministry that it doesn’t use any ZTE or Huawei equipment in its network.
  • Vodafone Idea Limited (VIL) was less transparent with its disclosures. It only told the government that it had always been compliant with various security requirements issued by the DoT.
  • Bharti Airtel Limited told the ministry that it used telecom equipment from several vendors, including Indian, American and Chinese. According to Dhotre’s reply, it isn’t clear if any of the Chinese equipment was sourced from ZTE or Huawei.

The ministry said that the Department of Telecommunications had asked BSNL, Airtel, Reliance Jio and Vodafone Idea to carry out a special security audit of their network by an external agency.

The information was dislcosed in response to a question by Rajya Sabha BJP member KC Ramamurthy, who had asked about what action the ministry had taken regarding “back door” vulnerabilities in telecom networks, particularly from China, and whether any telcos used equipment acquired from Chinese companies. Dhotre said that the government was aware of the dangers of spyware/malwares, including backdoor vulnerabilities, and had issued issued security guidelines to telcos in 2011 in consultation with the Home Ministry.

Govt aware of developments in US

Interestingly, another BJP member Jyotiraditya M. Scindia also posed a similar question to the ministry, in which he was told the government the developments on Huawei and ZTE in the US. Scindia had asked whether the ministry had received reports that Chinese vendors had installed back doors and trap doors in telecom networks of other countries. Dhotre, in his reply, said the government was aware about the US government’s report “Investigative Report on US National security issues posed by Chinese Telecommunications Companies Huawei & ZTE“. It added that it was also aware of the US Federal Communications Commission (FCC) orders which had designated Huawei, ZTE and their affiliates as national security threats to the country.

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Concerns about Huawei and ZTE: Huawei and ZTE are currently caught in the middle of a trade and tech war between China and US. In June this year, the US FCC had designated the two Chinese companies as “national security threats” as they were likely cooperating with Chinese intelligence services, and had close ties to the country’s military. In May 2019, the US Department of Commerce added the Huawei maker and 70 affiliates to its “Entity List”, effectively prohibiting the company from importing, exporting or using American technology. In August this year, another 38 other Huawei-affiliate companies were added to this list.

Earlier in 2018, Huawei was caught in another international scandal, when its CFO Meng Wanzhou was arrested at the airport in Vancouver, Canada where she was facing extradition to the US. She was accused of trying to violate US economic sanctions to Iran. In February, the country’s Department of Justice indicted Wanzhou on charge of trade secrets theft and racketeering. In May, a Canadian court allowed for the extradition of Zheng to the US.

***Updated at 11:30 IST to add IT Ministry’s reply to Parliament about the government not planning to exclude Chinese companies from 5G infrastructure contracts. Originally published at 11:10 IST, September 18, 2020. 

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