[liberationtech] The Economic Times of India: 'Suspicious' Huawei to help set up telecom lab in India

[Alexander Rea]

I am a fan of history. Especially the global landscape shaped post-WWII.
When colonial rule ended in British India and the following formation of the
new India and Pakistan. Each country has had good and bad times with the PRC
and arguably worse times between their borders. I find it very clever that
PRC firms are supporting India telcos and providing combat vehicles to
Pakistan. Playing both sides. I think everyone should do their own quick
research on the history of these countries.

@AlexanderRea

On Jun 25, 2011, at 10:19 PM, Rebecca MacKinnon <rebecca.mackinnon at gmail.com>
wrote:



http://articles.economictimes.indiatimes.com/2011-06-23/news/29694671_1_telecom-gear-telecom-equipment-chinese-vendors

'Suspicious' Huawei to help set up telecom lab in India
Joji Thomas Philip, ET Bureau Jun 23, 2011, 11.21am IST

NEW DELHI: Rather like letting the fox to guard the henhouse, India plans to
entrust a Chinese company with a crucial role in helping ferret out spy
software hidden in imported telecom gear.

Huawei Technologies, a major supplier to Indian mobile phone firms and the
object of the Indian government's suspicion, has been enlisted to provide
knowhow and equipment for a facility that will be a clearing house for all
imported telecom gear, the draft of an agreement shows.

Huawei and the Indian Institute of Science in Bangalore, where the testing
lab will be housed, will soon sign a memorandum of understanding under which
the Chinese company will provide "documentation, expertise, methods and
standards for studying telecom equipment," a government official said.

 India was compelled to take the help of the Chinese company because no
Indian firm makes telecom gear and no other foreign company was willing to
assist because of worries about intellectual property rights, the official
said.

Huawei is the world's second-largest telecom gearmaker after Ericsson, with
2010 revenues of $28 billion (Rs 1.27 lakh crore). The government has been
suspicious that it and another Chinese company, ZTE, could use the telecom
equipment they supply to snoop on India and even launch cyber attacks.

The lab at IISc is being built solely to address the concerns of
intelligence and security agencies about the Chinese vendors. "In order for
IISc to perform certain studies in respect of telecom equipments, IISc shall
be requiring detailed understanding about various features, standards and
related documentation. Huawei...agrees to share some information, knowledge,
software, hardware and equipments with IISc for its studies," says the MoU,
seen by ET.

It also says that both of them can visit each other's facilities, including
Huawei's manufacturing plants and logistics centres. The IISc centre was
given funding by finance minister Pranab Mukherjee in the 2010-11 budget. It
is being modelled after the China Information Technology Certification
Centre that operates and maintains a national evaluation and certification
scheme  for that country's IT and telecom security.

 A pilot lab has started functioning in Bangalore and a fullfledged centre
is likely to be established in next three years after the approval of the
Cabinet Committee on Economic Affairs, minister of state for communications
and IT Gurudas Kamat told Parliament in May 2010. Just a year ago, Huawei
and ZTE were battling to avoid being banned from the world's largest market
for telecom equipment.

Beginning February 2010 for six months, the home ministry refused to clear
telecom equipment contracts worth hundreds of millions of dollars allotted
to Chinese firms on fears that these companies had the capabilities of
installing spyware and malware that could monitor voice and data traffic and
disable networks. This delay disrupted the expansion plans of several mobile
service providers.

 Imports from Chinese vendors resumed only in August 2010 after Huawei and
ZTE agreed to comply with new rules that make it necessary for foreign
equipment companies to put their software in the equivalent of a sealed
envelope to be opened by Indian authorities only in the event of a security
threat.

In the same month, Huawei, founded by Chinese army veteran Ren Zhengfei,
revealed details of its shareholding to the Indian government in what it
said was an unprecedented disclosure.

India is the world's largest market for international vendors. Sales of
telecom equipment are expected to increase from $12.5 billion in 2009-10 to
$40 billion in 2020, according to telecom regulator Trai. On Wednesday,
telecom journal Voice & Data said revenues of Huawei and ZTE in India fell
by 23.5% and 12.8%, respectively, for the twelve months to March 2011 after
they were barred for several months last year from supplying equipment to
companies here.

Huawei's India sales were Rs 5,688 crore while for ZTE it was Rs 4,118
crore. Nokia Siemens overtook Ericsson with annual revenues of Rs 6,117
crore to be the largest equipment vendor in India.

A Huawei spokesperson declined to comment on the pact, but an executive
close to the company confirmed that a deal had been struck. The person added
that the move to share IPR and commercially sensitive information with a
statefunded research agency here would go a long way in bridging the trust
deficit.



Rebecca MacKinnon
Schwartz Senior Fellow, New America Foundation
Co-founder, GlobalVoicesOnline.org
Cell: +1-617-939-3493
E-mail: rebecca.mackinnon at gmail.com
RConversation.blogs.com
facebook.com/rmackinnon
Twitter: @rmack


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