Telecom Equipment Market in India 2014

The new report, 'Telecom Equipment Market in India', states that India holds immense opportunities for telecom equipment products. India is one of the world's fastest-growing telecom markets. The country houses a mammoth wireless subscriber base which is served by a number of wireless network operator and other service providers. Also, India being a major IT and ITES hub, there are significant number of companies dependent on telecom products. These have generated considerable level of demand for telecom equipment in the country.

India is largely dependent on import for telecom equipment. Dometic production of the same has been negligible as compared to imports. Chinese and European companies, leveraging on this deficiency, are catering to the needs of the country with wide range of telecom equipment products at competitive price points.

However, the Government of India has realized the essentiality of domestic production of telecom equipment and hence has come up with a number of policies and perks to enhance the same in the country. Apart from allowing 100% FDI for telecom equipment manufacturing, the government is also setting up telecom centers of excellence across India to promote domestic manufacturing. In 2012, the Union Cabinet approved INR 100 bn as financial support for the development of electronic manufacturing clusters while recently, additional INR 100 bn was approved to promote large scale manufacturing in India. This presents the best time for mobile accessory companies to establish manufacturing units in India. On the export front, India is gradually picking up pace, principally with export of mobile handsets.

Rapid growth in telecom subscriber base, and introduction of 3G and 4G induces telecom equipment requirements across the country. With rising usage of 3G services and adoption of 4G technology, the need of telecom equipment will only rise as service providers enhance their capability to handle more users and service requests from across the country and beyond.

Furthermore, IPv4 to IPv6 migration is being carried-out in phases which require service providers across India to adopt IPv6 compliant telecom equipment. Significant demand for telecom equipment will be created by the same in the coming years as service providers and stakeholders embrace the new internet protocol to achieve compatibility.

Foreign telecom equipment companies, however face heat from Indian security agencies over probabilities of threats from their products. This, however, creates opportunity for telecom equipment companies having manufacturing facilities in India.

Telecommunication in India being one of the prime support services essential for rapid growth and advancement of various sectors of the economy, future prospect of telecom equipment market looks promising. Government initiatives, policies and reforms in the Indian telecom industry provide further encouragement in this aspect.