Telecom secretary Neeraj Mittal on Monday said the government is looking to bring an improved and better telecom production-linked incentive (PLI) scheme and is open for suggestions from the micro, small and medium enterprises (MSMEs).
“The new scheme which will be a better scheme, (for that) we look forward to suggestions from the MSME industry to see where we can improve,” Mittal said at the Bharat Telecom 2024 event organised by the Telecom Equipment and Services Export Promotion Council (TEPC).
Mittal stated that the government has been focusing to develop the telecom component ecosystem in the country. “Its not good enough to bring sub-systems and assemble them here, and bring efficiencies in the low value addition part. We also need to build a telecom component ecosystem in India,” Mittal said.
Another likely reason for a new telecom PLI scheme could be the nearing exhaustion of the allocated budget, with the current scheme. The department of telecommunications (DoT) launched the telecom PLI scheme in February 2021 with an outlay of Rs 12,195 crore, to promote telecom and networking products.
The scheme was amended in June 2022 for including design-led manufacturing. Total 42 companies including 28 MSMEs were approved under PLI scheme. The companies were also allowed to shift their five-year PLI scheme period by one year, in order to meet the targets.
As of November 30, 2023, the PLI beneficiaries have made an investment of about Rs 2,842 crore, with sales of over Rs 40,800 crore, according to government data. Companies such as HFCL, ITI, Nokia, Jabil, Coral Telecom, Lekha Wireless, Tejas Networks, Samsung, etc, are part of the telecom PLI scheme.
During his address, Mittal said the MSMEs are building excellent products but also need to see how they can compete with big companies and get orders not only from public sector units but also private telecom players.
“I will be happy when MSMEs will be able to compete, not just in tenders of BharatNet, which is a government procurement project, but of private sector rollouts which are happening,” Mittal said.
In order to open market size for MSMEs in the sector, the government recently announced partnership with the US in the area of telecom and technology. According to Mittal, there is a strong interest from the US and other like-minded countries to collaborate with India on open radio access network (RAN), telecom standards, cyber security solutions, in a bid to develop trusted regime.
Lately, the domestic companies are also seeing a huge export opportunity from the US Rip and Replace Programme. The programme is aimed at moving away from Chinese players like Huawei and ZTE, especially with regard to already installed 4G equipment in the US and replacing that with modern, fully functional equipment, which not only involve less capital expenditure, but are also responsive to changing business needs.