The Narendra Modi government’s recent decision to allow Huawei to partner with domestic telecom companies for 5G spectrum trials is likely to cause a flutter across the establishment – from the Indian Army to the NITI Aayog.
After all, both these institutions have already expressed serious reservations – the Army because of the same security concerns that led the United States and Australia to ban Huawei from participating in 5G trials; and the NITI Aayog, because it wants domestic alternatives that are currently under development to also be explored.
Even though the Modi government has said that Huawei has been cleared only for the trials, there is a fear that it will be difficult to stop the Chinese firm from securing contracts once it gets to demonstrate its capability.
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The Huawei factor
Huawei currently has both technological and cost-related advantage over its competitors in Frequency Range 1 (FR1) – less than 6 gigahertz (GHz), which is one of the two ranges specified for 5G ‘New Radio’ global standards; the other being Frequency Range 2 (FR2) – of 24-100 GHz, that is, in the millimetre wave (MMW) band. Incidentally, the Americans believe they have the technological advantage in the MMW band, which is why Huawei has been in their crosshairs in the recent past. Washington seems eager to prevent Huawei from locking in customers in FR1 and attaining formidable economies of scale, which will make it difficult for American companies to spread FR2-based solutions.
Now, India’s Department of Telecommunications will likely hold trials for both FR1 and FR2. But New Delhi is not in a hurry because of the Indian Space Research Organisation (ISRO)’s desire to have some of the MMW band sequestered for itself. In fact, India joined China, Russia, and Japan in opposing the use of 26 GHz for 5G operations at the World Radio Congress in November 2019, even as the US pushed for it. As such, Indian telecom companies (telcos) that currently seem focussed on FR1 are likely to be susceptible to Huawei’s offerings. Two out of India’s four major telcos have already indicated that they are open to partnering with Huawei for the trials.
The US-China ‘tech’ war has made Huawei even more desperate to lock in overseas markets while it still can, since its cost advantages may get eroded on account of having to indigenise critical components such as chipsets. Given that motivation, Huawei is also likely to offer generous lines of credit to India’s debt-ridden telcos. Vendors like Huawei typically offer end-to-end solutions for 5G infrastructure that are essentially ‘black boxes’ for the customer.
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5G needs domestic equipment
Even if one of India’s major telcos chooses Huawei as its vendor for the 5G rollout, it will be a scary prospect for India to have a significant part of its future economic vitality depend on a vendor from a country with which it has a vast disputed frontier, characterised by intermittent tensions. 5G is not merely a next-generation wireless technology; it is projected to emerge as a true ‘general purpose technology’ (GPT), like electricity, over the next decade or so. All pillars of the future economy, whether smart city or industry 4.0 or driverless cars, will ride on it.
In that sense, no serious country can deploy a GPT like 5G with mostly imported intellectual property or equipment, whether acquired from China or a supposedly friendly nation. You might as well build your future on quicksand. This is precisely why Vietnam’s Viettel has persevered to develop its own 5G technology demonstrator and aims to deploy a large network in 2020 with domestic equipment.
Huawei’s case is egregious since it is subject to China’s 2017 National Intelligence Law, which urges it to ‘support, assist and cooperate with the state intelligence work in accordance with the law’; and a 2014 Counter-Espionage Law, which says that ‘when the state security organ investigates and understands the situation of espionage and collects relevant evidence, the relevant organizations and individuals shall provide it truthfully and may not refuse’.
Imported 5G systems do not only pose a threat to data security but would have extended the risk to everything by the 2030s, once the internet of things becomes ubiquitous.
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India shows signs but more work needed
It is not as if New Delhi is unaware of what is at stake. The Department of Telecom funded the development of a $34 million ‘large scale’ 5G tech demonstrator at IIT Madras in 2018. This demonstrator, set up as a result of a multi-institutional initiative involving several IITs and IISc, is currently being tested with encouraging results. The operating range includes both FR1 and FR2 bands, and the 5G testbed has ‘user equipment, customer premise equipment and all the base stations including antennas, multiple-input and multiple-output or MIMO systems, millimetre wave antennas, the front, and the backhaul to the processing units’.
Based on initial results, IIT Madras believes that the system will exceed current 3GPP 5G performance requirements – the global standard. Apart from a few packages for which the standard essential patents (SEPs) reside with South Korea and China, the software has been developed in India.
Most of the equipment used by this testbed has been made in India, and IIT Madras believes that with the right kind of governmental support, Indian vendors can even scale up their output to support a much larger version of this demonstrator to encompass a territory the size of Delhi. Various stakeholders believe that such a venture can be up and running within 24 months. Naturally, chipsets used in domestically supplied network equipment continue to be those designed and built in foreign countries. Although, IIT Hyderabad has been working on an indigenous chip for 5G base stations and can do more if funds are made available. At least three new 5G-related chipsets are currently under development in India, although they will be fabricated abroad given the continued absence of a commercial semiconductor foundry in India.
IIT Hyderabad has also developed a unique nonlinear massive MIMO technology, which can more than triple the network capacity. Unfortunately, for such SEP ideas to be incorporated into 3GPP’s specifications, India will have to mount a proper national-level effort beyond what the Telecommunications Standards Development Society, India (TSDSI) has done till date.
India must realise that 5G is not an arena where a Huawei is competing with a Qualcomm or a Samsung; it is a geo-economic battleground where China is competing with the US or South Korea. Incentivising the use of homegrown systems and software by domestic telcos is a must if 5G vendors in India have to attain any sort of scale. For this, the licensing agreements for 5G spectrum must include domestic value addition clauses. Given that the Supreme Court of India has directed telcos to clear the Rs 1.4 lakh crore dues to the Modi government, one would think that New Delhi has some leverage to make them realise the importance of buying at home, even if it turns out to be somewhat more expensive. 5G is too important to be left to the telcos.
The author is a former consultant to FICCI’s International Division and Chief Editor of Delhi Defence Review. His Twitter handle is @SJha1618. Views are personal.