Defence contracts emerge as key business for telecom infra makers
Subscribe to enjoy similar stories. India's push for local manufacturing is prising open a new business frontier for domestic telecom equipment manufacturers.
The defence forces, which have largely relied on overseas vendors for communication requirements, are now seriously sourcing from Indian companies such as HFCL Ltd, Sterlite Technologies Ltd (STL), and Tejas Networks Ltd. The development comes against the backdrop of evolving geopolitical and national security concerns in terms of importing sensitive telecom infrastructure from foreign companies, including those from China.
Expectations of upcoming demand for localized equipment from defence clients and allied applications has got telecom infrastructure manufacturers to build intellectual properties (IPs) and pursue defence contracts upward of ₹1,000 crore ($120 million) annually, according to senior executives of telecom infrastructure manufacturers who spoke anonymously. Two of these executives alluded to plans to scale defence businesses to upward of ₹3,000 crore “within the next two years, as indigenization leads to the development of cutting-edge and sophisticated telecom equipment from within India itself".
“We’ve built crucial network infrastructure, including complex technologies, which we did not need to source from any other geography in the world," said N. Ganapathy Subramaniam, chairman of Tata Group-owned Tejas Networks.
He cited an example where the company has built an integrated single-tower structure approach for its network instead of two separate towers for consumers and enterprises. “This is helping us do away with the need to duplicate infrastructure for telecom operators, reducing capital expenditure (for those deploying the infrastructure),"
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