Telecom Setup in India

1. Overview:
1.1 The story of the production of telecommunications equipment in India is not an exciting one. The country had a very early start. The First and Second World Wars greatly interfered with the importation of telecom equipment from Great Britain because of the German submarines torpedoing the ships. That circumstance was responsible for the British to set up some production units, mainly for manual telephone exchanges and telecom line materials and equipments. Post- Independence was to be one of self -reliance if not self –sufficiency. The initial high aspirations and motivation which resulted in the setting up of the Telecom Research Center and the Indian Telephone Industries (ITI) and the Hindustan Cables in the public sector could not be fulfilled as some senior officers of the Department of Telecoms (earlier, P&T) were bitten by the idea, why should we reinvent the “wheel”. Therefore successive technologies were imported and the short falls in production were made good by imports whenever the country’s foreign exchange position permitted. The Industrial Policy Resolutions of the late 1940s and early 1950s and the magnificent obsession with the socialism due to which telecoms came to be exclusively in the government sector further impeded our research & development; designing and production capabilities . The P&T / DOT jealously guarded its turf for monopoly. Other public sector units like the Bharat Electronics and the Electronic Corporation of India Ltd (ECIL) which were producing communications equipments ( as well as some consumer products and appliances) were also excluded from telecom equipment production for long.

1.2 The only worthwhile indigenous R&D and productionisation effort was when the Center for Development of Telecoms (C-DOT) was setup in the mid 1980s as a society jointly funded and managed by the Departments of Telecoms and Electronics . It was initially cold -shouldered and even opposed by the monopolist lobby in the DOT but since it had the young Prime Minister, Sri Rajiv Gandhi’s blessings and involvement and inspiration, it did wonderful things, partly wiping out the shame of India’s incapability to design, develop and productionise its own equipments.

1.3 China and Korea which are now far advanced than India in every sector of communications equipment including computer -based systems were behind India till the early 1980s. But then a great patriotic national effort seized both the countries. We know the result. Korea was the first to be at Japan and now it is the turn of China . Both countries have nurtured the birth and growth of national champion, multi-nationals for IT-based, modern communications and of course, consumer electronics . Sony, Samsung and Lucky Gold (LG) Star of Korea are household names Huawi and ZTE of China are now beating the established communications companies like the Lucent ( former Western Electric of AT&T), Siemens , Ericsson etc, in the latter’s home countries. What is astounding is that these companies are establishing development centers in India to utilize our talent and their enterprise finance and of course, their vision.

1.4 Much of the know-how for production of electronics equipments in India originated in Bhabha Atomic Research Center (BARC) . The Electronics Corporations of India (ECIL) owes its birth to the BARC. The Bharat Electronics was set up in the 1950s in order to foster self-reliance in defence communications. Its intellectual inputs came from the Defence Departments, S&T and R&D establishments.

1.5 In the later half of the 1970s, the Department of Electronics (DOE) was set up. That was also the time when the telecommunications switching and terminals (telephones, PABXs) were going electronic elsewhere in the world. The DOE wanted to promote production of communications, equipment under its own patronage . The DOT was however reluctant to let its monopoly be diluted . Almost all the transmission equipment including the microwave radio and satellite communications co-axial cable and optical fibers are electronics- based . The DOE induced every state government to set up a state electronics corporation . Therefore emerged the Keltron, Meltron, Gujcom , Hartronics, Elcot, APEDC, WBEL and so on, every one as a state government undertaking. They might produce communications equipments but the DOT was the largest user of them . If it didn’t approve of their equipment or did not buy them, what could they do? How would they thrive? Since the Department of Electronics (DOE) was always under the charge of the Prime Minister, it could gradually undermine the monopoly of the DOT for the production of electronics-based communications equipment outside the Indian Telecom Industries (ITI). In China, the Peoples Liberation Army setup companies to compete with one another . State did orchestrate the competition which alone ensured continuous research & development but in India dissolute socialism could not build up great companies inspite of the state having monopoly in production of communications equipments. This is our grievous failure . In early 1980s some of us myself and the late Sri UDN Rao as General Managers of Telecommunication Services in the States of Andhra Pradesh and Tamilnadu looked to the ECIL and Bharat Electronics to give us new products. Our encouragement made the ECIL design, develop and produce a store and forward telegraph system using teleprinters. It was computer - based . We demonstrated that every indigenous company could be a national resource. When I moved to the Telecom Directorate as its Dy. Director General , I encouraged the undermining of the DOT’s monopoly by the State Electronic Development Corporations (SEDCs). I didn’t then dare to go to the private companies . The West Bengal Electronic Corporation Ltd., WEBEL was encouraged and guided to produce non-mechanical i.e electronics - based and micro processor -using director switches for the Calcutta telephone system to replace the aging electro-mechanical directors. The Keltron was encouraged to produce computer assisted -manual trunk exchanges which would improve the productivity of operators 5-fold. Pressing this demonopolisation further, we co-opted even private companies along with the SEDCs to produce add-ons to our unintelligent electro-mechanical telephone exchanges. Some of these were automatic message accounting ( that could give detailed bills for STD & ISD calls), multi-line observation equipments (MLOEs) and subscriber trunk dialing enabled local manual telephone exchanges.

1.6 The real break-through came when the monopoly of the government companies like ITI was abolished in the early 1990s for the production of transmission equipments, mainly wireless based like multi-access rural radio, microwave radio etc. A number of private companies in Hyderabad and Bangalore started setting up their own in -house development units to produce systems to the DOT specifications. By the mid 1990s, indigenous private and public sector communications companies gained the capability to compete against foreign companies for radio equipments. Of course, they had to use many imported components and even sub-systems. I will cover the post National Telecom Policy 1994, situation in regard to communications equipment manufacture in part -II of this paper.


Part-II

In the Period, 1947 to 1990s.


1.1 One of the tragedies of Indian Telecommunications is the lack of philosophical, sociological, economic, financial, technology and policy studies, inquiries and researches into them. The result is that a vital sector like telecoms which now (2004) annually yields service revenues of over Rs. 80,000 cr. has network investments of over Rs. 120,000 cr. equipment 30 lakhs at anytime till a few years ago was for long administered by civil service engineers uninformed by economics and finance, unregulated by cost and price accountants uninfluenced by consumer opinion. The reason is an unchecked privilege for provision of service by a government department which appropriated the totally of policy, production provision and regulation by convenient interpretation and administration of the Indian Telegraph Act 1885 and the Industrial Policy resolutions of 1948 and 1956. The consequence is our inability to build upon a find British legacy of early production of telecom equipments, perpetual penury of telecom services (until full demonopolisation in 2000) and increasing gap between what is needed and provided, our potential and performance our levels of technology and services and those of the developed and even some of he developing countries.

1.2 Although we have been having a very long history of telecom equipment production in the Telecom factories (in Bombay, Calcutta and Jabalpur), in the Indian telephone Industries Limited (1948), the Hindustan Cables Limited (1952) and the Hindustan teleprinters (1962), all except the HCL, under the DOT, we have never been having sufficient production and production, have only in the last few years come to take up telecom equipment production . From the early 1980’s we have been having a sizeable number of State Electronic Development Corporations (notable among whom are KELTRO, GCEL, MELTRON, WEBEL and the PCS) wanting to make communications equipments . And then in the late 1980’s,t eh C-DOT brought into being a number of people’s (private) sector enterprises into telecom manufacture. While in switching we have indigenous designs (the C-DOT RAZ and the ITI’s ILT) and production upto 2000 line capacity and production of CIT-Alcatel’s E-10B digital Switches of higher capacity there are large gaps in the whole range of transmission equipments and large sized telephone switches of more than 10,000 lines for our large cities.

1.3 The opening of the Indian Telecom market under the Government’s New Economic Policy to the world’s giants both for manufacture and investment in selected services between 1993 and 2000 and in all services since 2000, raises new issues, chief among which is the need for an independent and objective Regulatory Authority which is distinct from the incumbent service provider and net-work owner for enabling the new productive enterprises to play in the extension, improvement and development of the Indian telecoms to the levels of India’s global partners in trade and commerce.

1.4 The overview I am giving in the following paragraphs is based on my close association with the DOT as its officer in various positions and my decades long critical appraisal of its policies, procedures and administration. I have been termed as a harsh critic. Perhaps I am . But none but an insider has more knowledge than others. Readers, especially those who attempted to be telecom equipment producers would be able to judge whether the overview presented here conforms to with and confirms their experience. The over-view covers different stages of the history of telecom equipment production in our country. I confess it is not comprehensive.


2. MANUFACTURE- PRE C-DOT STAGE:
2.1 Early Beginnings:
India was fortunate to have both the Telegraph invention and Introduction soon after its use in the West. The first telegraph service was started in 1854 and the first telephone service in 1882. All equipments were imported but the British soon found that it was more economical and expedient (especially during the World Wars to make some of the equipments within India. Thus came the telegraph workshops now called telecom factories in Calcutta, Jabalpur and Bombay. In the initial years line materials like anchor plates, sockets, tubular telephone poles made out of galvanised and riveted mild steel sheet, brackets, galvanised iron wires etc, and manual switch boards were being made in these telecom factories for the last over 100 years. In the last decade two more were added in Bhilai ( to produce steel towers) and Khargapur ( to produce stalks). In the beginning, there were only manual exchanges requiring elementary technology. The relays required for the equipment were also made in these telecom factories. The so-called technology still continues although it is so elementary that anybody else in this country can make these things better and at lesser prices.

2.2 Strowger Technology:
Automatic exchanges of the Strowger type were introduced in the second decade of the century ( first one in Simla in 1912). The equipment was imported from Great Britain. To inter-connect the cities, the trunk lines used copper wires in eh beginning and by the mid 1930 repeaters as well as open wire carrier systems involving electronic equipments were introduced in the network. These equipments were also entirely imported. Impediments in brining the equipment into India during the 2nd world War impelled the Department to think of more production within the country. Thus, a scheme to set-up a telephone equipment making factor in India was drawn up just before independence but the factory, namely Indian Telephone Industries actually came up in Bangalore after Independence in 1948, with an initial capacity of 25,000 lines per year. The ITI was started as a departmental factory but soon it was incorporated as a wholly state-owned Company. Just at about that time, one of the largest automatisation programmes of a manual system in the east was undertaken in Calcutta and the technology chosen was the then quite upto date Director-Controlled step-by-step strowger exchanges. The know-how was taken again from Great Britain both for the Indian Telephone Industries (from the ATE) making the switching equipment, telephone instruments and for automatisation of Calcutta’s phones.

2.3 Indigenous capability:
2.3.1 In the pre-Independence days, the then P&T Department had a nucleus for design and development and production facilities in the telecom factories. Two varieties of manual trunk exchanges (The T-32 and T-43) and various circuits required for them were designed and produced in eh Telecom Factories. The amazing thing is that the manual trunk exchanges ( called T-43) designed in the 1940s are without any change, still being produced and installed and by using computers in the Indian telephones. The non-modernisation in this regard is one of the reasons for the inefficient trunk service we are having in the country.

2.3.2 There was foresight and vision in the P&T in 1950s as a result of which the Indian P&T set up in 1956, the Telecom Research Center (TRC). Very commendably, it designed transmission equipments, the 3 channel, 8 channel and 12 channel systems for open wire lines. These were productionsed in the Indian Telephone Industries. These developments of eh 1950s are still the current production with a few modifications but in inadequate quantities. The vacuum tubes had given way to transistors. The technology is so un-sophisticated that this type of equipments could be produced by any common electronics company ranging from the Ste Electronics Development Corporations to a large number of private companies. It is a matter of regret that in spite of an early start and proven capability this know-how has not been shared with other Indian enterprises (exception : Goa telecoms connect to village exchanges a few years ago) with the result that we did not have enough to their small town centers. The rural area and small towns are starved of good short-haul carrier systems to the extent of a few thousand. The automatisation of short-haul, low revenue-yielding but highly satisfying ( upto about 60% of “trunk” calls) so greatly impeded due to this reason.

2.4 Crossbar-Technology:
2.4.1 By the early 1960s, it was realised that in order to introduce nation-wide subscriber trunk dialling (STD), the step-by-step, strowger exchanges would be a disadvantage and therefore, common control switching systems should be introduced.

That is how the Penta Conta Cross-bar exchanges were introduced in India. The equipment was initially imported from the Bell Telephone Manufacturing Company ( of Antwerp, Belgium), a subsidiary of the International Telephone and telegraph Corporation-ITT. Know-how and machinery was also obtained from them to set up a factory to produce the Cross-bar equipment in Bangalore by the ITI. This is the second switching technology import of India. This equipment proved to be a near-disaster when commissioned in Bombay in 1967-689.

2.4.2 Many deficiencies were noticed. The equipment could not cope up with the very large number of call attempts, most of them unsuccessfully as characteristic of telephone systems in big cities in India. There were defects in the original designs and the quality of equipment produced in India.. The experience has been traumatic. It led to a re-design and upgradation effort in the Telecom research Center under the name Indian Cross-Bar Project –ICP. Begun round about 1969, the equipment to this design has, however, started coming up only in 1985-86 ( 1a 16-year long wonder) from the ITI’s news plant in Rae Bareilly. This long delay for an “Indian” design (adoption and modification) to be productionised is worth noting and is symptomatic of our hither to available effort and knowledge and expertise in productionising designs and management of such projects.

2.5 Electronic Switching:
2.5.1. By late 190s and early 1970s it was evident that the electronic exchanges would replace electro-mechanical exchanges and would be eventually cheaper and more versatile. The Telecom Research Center took up a project for designing and electronic switch for pubic service and it did succeed in fabricating and commissioning a stored programme controlled (SPC) analogue electronic exchange in Rajouri Garden, New Delhi in eh early 1970s. A number of connections were given from it on a trial basis to selected subscribers who also had a telephone from an electro-mechanical exchange. While conceptually it was a success, practically it was non-starter because of frequent component failures and system break-downs. The effort, however, generated confidence and proved our capability to undertake developmental work on electronic exchanges but because of the weak component base and inadequate material and man-power inputs and proper management and lack of will, the effort was abandoned, a grievous blow to foster indigenous know-how and a shameless refutation of professions of self-reliance.

2.5.2 It was evident that the crossbar technology we have adopted was leading to the undoing of the Indian telephone system, especially in the big cities. All crossbar trunk automatic exchanges have become traffic sinks, i.e calls entering the exchanges were not exiting and lost to a great extent. A system selection group thatcame into being in the 1960s was continuously in search and study of new systems and became a more or less permanent outfits, first choosing a crossbar technology ( and its vendor) and then an electronic system. By 1980, it was felt that digital electronic exchanges both for local and trunk service would by the best and cheapest and techno-economically the most appropriate solution. It was also felt that the world trend of digitalisation of both switching and transmission would be appropriate for India too.

2.6 Continued imports:
2.6.1. There has, however, been a continuous gap between what we could produce in India either Strowger or Crossbar equipment and what is needed and so imports continued. 600,000 lines of Japanese crossbar (C-400) equipment from three Japanese companies was imported. There are now three varieties of crossbar equipment in the country-Pentra conta type and an ICP both produced in India and imported C-400 type. A 10,000 line Ericsson ARF x-bar exchange was also imported and placed in service in Idgah, Delhi for trial and although its performance has been the best, strangely that type of equipment could not enter the Indian market. Other imports are four electronic telex exchanges of Siemens make from Germany in 1981-82 (with a technological tip-up now for making in India by ECIL), a number of analogue electronic exchanges in containers from Philips Holland and 400 to 800 lines capacity digital exchange from NEC Japan – what a variety? Further, imports of analogue electronic equipment – FETEX-100 from the Fujitsu of Japan the tune of 200,000 lines were made from 1982-83 onwards.

2.6.2 While this import was being contemplated, the DOT also decided to set up an electronic switching factor producing digital switches. Tenders were invited for the import of 200,000 lines digital exchanges linked to the transfer of technology for setting up a 500,000 lines per year digital switching equipment factor. In the event the global tender frame work and the tenders received were all given up and the direct offer of a French Company, CIT-Alcatel, backed by the French Government, was accepted. Thus came into India the fourth version of India-made telephone switches – the E-10B digital electronic exchanges. A factory has been set up in Mankapur (1985) with the French know-how from CIT-Alcatel. The E-10B’s technology was developed during the 1970s.

2.7 Grievous Time-lags:
2.7.1 Certain facts are worth noting. Strowger technology in India is about 40 years old and had been completely mastered excepting that the quality of equipment coming in later years was poor when compared to that in the late 40s or 50s. The Penta Conta cross bar, the imported technology has never been satisfactory. It continues to suffer from design defects and bad materials. Its Indian version had come, almost when it was time not to produce electro-mechanical equipment. When it was very clear to the Department of telecom that common control electro mechanical equipment was superior to step-by-step strowger, precisely at that time a manufacturing unit was set up to produce that very Strowger equipment in Rae Bareilly. Similarly when the DOT came to the conclusion that electronic equipment should be introduced and that it would be superior to any electro-mechanical switch, exactly at that time was set up a second cross bar factory in Rae Bareilly. Similarly, again when digital switching equipment was thought to be the appropriate solution, analogue equipment was imported. And when a digital switching factor is set up technology chosen is that of 1970s origin despite the fact that by the early 1980s superior digital technology was becoming available from several sources in the world. Large and very large scale integration reduces the number and type of cards and extensively administrative, maintenance and management systems are getting built into the switches of 1980’s designs. The reason for all the inappropriate and bad technology solution every time it was chosen was due to the very large time taken first to take a decision and then for implementing the decision. This has very much to do with the organisation and the decision-making process and the management’s adequacy and vision to envisage and handle change.

2.7.2 In the 6th Five Year Plan Telecommunications Rupee investments exceeded the initial allocation while the targets were less than 70% in respect of switching and less than 20% in respect of transmission, both because the prices of indigenously produced equipment (in the PSUs) went on rising and because imports had to be made due to inadequate production in India.

2.8 Transmission:
2.8.1 In transmission, there continued lamentable inadequacies. The TRAC undertook designs of transmission systems and offered them to the ITI for productionisation. Many of them are near-failures. Glaring examples are its as yet unavailable, much trumpeted (for more than 20 years) single channel VHF radio system, the more than 15 years old PCM systems and nearly a 7 years old 7 channel VHF equipment. The narrow band micro-wave system designed and produced in the 1970s and the multiplexing equipment in production for about 25 years are of poor quality with inadequate stability. In all these, there has not been any foreign collaboration. The failures are due to poor quality of components that are available and the generally insufficient commitment to quality in the production units owned and managed by their sole buyer, the DOT.

2.8.2 It is now apparent that in spite of 40 years of design, development and production activities in switching, the DOT and its ITI did not succeed in having a switch of Indian design till recently. Not only that ; after 40 years, it still had to seek foreign collaboration to produce even the simplest of terminals namely, the telephone and when it chose a foreign collaborator, it was for the rotary dial and not for the almost, fault-free push button type of telephone. In respect of transmission equipment, the productionisation of its designs was not a success. The ITI sought a number of foreign collaborations for multiplexing and line equipment, for multi-access radio relays systems, for satellite earth station equipment and a host of others. It is indeed very sorry that so great and important a nation, so richly endowed with the third largest scientific and technological manpower as India has as yet no satisfactory transmission equipment production capability. Just as C-DOT has been set up to resolutely produce an Indian switch, so should have been a number of mission-oriented societies formed for development and productionsing of transmission equipment.

2.9 National Resources:
It is not understandable why the DOT confined most of its efforts of manufacturing to its own ITI. The Bharat Electronics Limited and Electronics Corporation of India Limited are also public sector enterprises and both could have developed as much capability as the ITI in regard to transmission equipment if only they too were invited and involved in development. In technology and hardware, the distinction between switching and transmission equipment is fast disappearing. VLSI, memories and processors ( computers) are the common stuff of all digital telecommunications and computers. The mechanical fabrication is not dominantly important any longer in switching. A number of State Electronics Corporations like the Keltron, Putron, Meltron, Punjab Wireless etc., have come up and there are a few in the private sector also. Are not these also national resources? Should not the service –provider namely, the DOT be eager to harness their production and research and development capabilities to produce equipment, especially the transmissions equipment for its use? Would it not be wise to draw up a list of equipment and systems wanted and make the specifications and requirements aggressively available to any intending manufacturer just as the C-DOT has been doing? It is hoped that in the light of a very unsuccessful production and productionisation record of the DOT, a new national policy would emerge utilising all the national talents in a patriotic way and not in a compartmental way. A large number of Indians abroad (NRIs) have got intimate knowledge of production technology, especially in the transmission field and in computer communications . At home, we may be good in design and development of systems but in productionisation we have not been successful. We should with more eagerness and determination and goodwill harness our brain reserves that are abroad and set up a multiplicity of competing production units. Importing of technology in areas in which we do not have any should not be shunned as that would impoverish our telecom system What require to be wisely done is import, adapt and advance just as Japan in the past and now, South Korea is doing.

3. The C-DOT Phenomenon:
3.1 An extremely articulate and aspiring USA-based NRI Sri Satyen Pitroda was in the early 1980’s able to attract and hold the attention and confidence of Prime Minister Indira Gandhi ( and late, Sri Rajiv Gandhi, even more) whom he convinced that as a national mission he would be able to design develop and productionise a family of indigenous digital SPC electronic telephone switches in as short a period as three years and for as little money as Rs. 300 million on R&D. The shame of repeated import of three switching technologies and eh shame of “self-reliance” which was being trumpeted could be ended by this spectacular achievement . If this mission was to succeed, it was necessary that the sole buyer the SOT must be willing . The Department of Electronics (DOE) must be an ally. The DOT had its own Indian Telephone Industries (ITI) with its own research. Research, design, development and productionisation by a rank outsider, the NRI Pitroda is an insult to DOT, the know-all and arbiter of telecoms in India . The DOE could expected to be co-operative and enthusiastic, for it has been wanting to and has already been successful in having an increasingly decisive role in the promotion of telecom-needed electronics production, be they exchange, customer-promises equipments (PBXs, telephones, modems, payphones) or transmission products. The NRI shrewdly got the Center for Development of Telematics (C-DOT) founded as a registered research society, jointly funded by the DOT and DOE, with the Communications Minister as the Chairman and himself as the adviser. He chose the life-long researcher Sri B.B.Meemansi, the one who rigged up India’s first ( and aborted) SPC electronic exchange ( analogue though) a decade ago as the Executive Director of the Co-DOT and a number of good designers from the TRC as the nucleus of his mission staff. In their several co-ordination meetings, the smarting DOT men put lofty operational and quality requirements (world class, high-speed, call handling capacity, the most advanced programming language and so on) All were accepted by C-DOT(!) perhaps as a matter of strategy (as later events would reveal).

3.2 The C-DOT built up a highly motivated team in a remarkably short period. It designed digital PABXs. It followed this success by small size ( 128 port) rural automatic exchanges (RAXs). The DOT men said that these were not the mandate of the C-DOT; it should produce a large switch. C-DOT said that the PBXs and RAXs were spin-off benefits and the stuff they are made of is common to the big switch it was designing. But a grand purpose was achieved. Earlier three foreign know-how for PBXs were purchase and a number of Indian companies were licences ( by DOE) to produce them. There was tender of the DOT to import electronic rural exchanges, equipment first and then technology eventually ( as per established pattern).

3.3 The C-DOT’s successful prodctionisation of its indigenous designs killed the import-wallas. The licencees of foreign PBXs abandoned the imported technologies. Many among them and a large number of others took to production of the C-DOT PBXs and RAXs. This was C-DOT’s and India’s finest hour unprecedentedly by any of the DOT which had the exclusive privilege of research, production and service for full forty years and over but which only meant repeated import of technologies.

3.4 The C-DOT did pioneering work. It took to simultaneous engineering of its designs. It went about the country inviting, inspiring and guiding land helping entrepreneurs to production of its designs. It did not adopt he DOT’s practice of asking ITI alone to produce. It did not treat Indian private enterprises as “untouchables” by application of the Indian telegraph Act, 1885 and IPR 1956 while often importing from foreign, ‘imperialist, multi-national, capitalist” private companies. The C-DOT treated all Indian enterprises as national resources and licenced its designs for production to private, joint and state undertakings including the ITI. Thus began the end of DOT’s monopoly over production of Telecom equipment.But no tits aversion to private, non-ITI companies. It wanted that the C-DOT’s RAX licences should make ‘packaged’ deliveries, that is, not only switch but battery, chargers, MDF, switch board cables, heat coils, fuses, iron work etc. And this notwithstanding that its own 40 years old ITI was itself not delivering the packages and the C-DOT licencees had no licencees to produce them. This fact is being mentioned to bring out the DOT’s opposition to the end of its monopoly in everything. The “package” hurdle had been remove by the DOT when it had come to have Sri Pitroda as the Chairman of the Telecom Commission and Sri G B Meemamssi as the Member (Technology). C-DOT’s path-breaking and glorious achievement is firstly design and productionisation of a wholly indigenous digital witch secondly the unleashing of peoples’ (private) enterprises to produce telecom equipment with most beneficial consequences.

3.5 A switch is not the entire telecom system. Nor is a PBX or RAX. The rural exchanges need to be connected to towns and towns, to cities. That is transmission equipment-U.H.F, VHF and micro wave radio, optical fiber devices and system, multiplexers, digital cross-connects, digital circuit multiplication equipment ( DCME), V-SAT satellite earth stations, cellular and trunked radio and a host of such productions. Neither the TRC nor C-DOT has any of them. The DOT split its TRC into research and engineering divisions, formed the former into a society ( like the C-DOT but for transmission) and the later into a new outfit, the Telecom Engineering Centre (TEC). TEC was to give type-approvals to various products and also assist the DOT to specify, evaluate and advise on technical mattes. As soon as the Telecom Commission was formed, the TRC was merged in the C-DOT. This began a new phase of “empire building” under a new czar at the TVs head. Now in the drivers seats, the duo started ruling, “scrap all foreign supplies and designs. We can do everything in an year-the large digital switch, the packet-switch, the computerised trunk manual exchanges, the automatic message accounting, everything the DOT needs and one an name. The former NRI : “nationalised” and even became not he “ four-in-one” telecom authority but a five-in-one” missionary. The rest is recent history. The prime-ministerial prop fell in the November, 1990 election; he big digital switch for Indian cities ( which was the avowed mission of the C-DOT in 1984 by 1987) is nowhere in sight , there are no transmission equipment technologies, the DOT’a Vikram and Center for Telecom Management and Studies and AMA and CAMA and all else are not there. The missionary has become an Adviser for all else but telecom and we are back with imports of equipment and technology on a grand scale ! The Indian dream of indigenous and self-reliant growth is still a sweet one, for ever green and unrealised. The C-DOT came under siege by competitors form all over the world.

3.6 I believe that C-DOT could have had more and lasting success if its philosopher and architect Sri. Pitroda remained a political and confined himself to “swadharma” ie, telecom and got his telecom agenda accepted by all the political partis. I may be pardoned if I sound immodest or prophetic. I had indeed written to Pitroda warning him against the dangers of his accepting the “Five Missions” and quoted the two Bhagawad Gita slokas:

The exertions of an achiever are one-pointed;
The non-achievers are several and endless - II-41


It is better to do one’s own duties imperfectly rather
Than other’s duties perfectly - III-35


I had written a piece “Telecom to Appear in your Election Manifesto” and sent it to all political parties in July, 1989 and gave it to Pitroda and told him what Sir. Bryan Carsberg, the Director General, OFTEL of UK ( the privatiser and regulator of British Telecom) told me namely that Sir Bryan met with and explained to the Labour and Liberal party leader what and why he was doing in telecoms so that whichever party won, the course of telecom reforms stayed unchanged. Alas! Pitroda got “nationalised” and “acculturised” by India so soon that he shared frequently familiar temporary triumphs and lasting damages to the country.

3.7 The C-DOT won’t admit but it’s adviser ( and so C-DOT) used his cloud to see that the DOT’s plan to set up a second E-10B electronic switch factory was not allowed to go ahead. The fear perhaps could have been that if large switches were available in the quality needed without C-DOT big switch coming, possible delays ( they proved to be actual) in the C-DOT product might marginalise the C-DOT and its switch. On the other hand, the ban on imports and the need for large switches may make the DOT more co-operative with and acceptive of the C-DOT by the DOT ( for giving relaxations, time over runs etc, as DOT gives to its ITI) The c-DOT and DOT also had very curiously ignored a great development that was taking place in the ITI-the design and productionisation of an SPC digital integrated local and trunk (ILT) switch of 2000 lines capacity- 4 time larger than what C-DOT produced. Its was only with the decline in the C-DOT’s fortune or clout, that ILT has come to be produced in quantity and deployed in the DOT’s network, now-a-days.

4. CABLES:
4.1 In a telecom system the rough distribution of capital costs until the late 1990s were:
Switch Local cable Network Transmission Intercity Customer Premises Equipment Land, Building A/C & Power such over heads
(1) (2) (3) (3) (4)
30% 37% 20% 5% 8%


While we have reviewed the switching extensively ( for the effort there was most) and a little ( for, we did not do much in that area) about transmission, we should review the cable and CPE situation also.

4.2 Very early i.e in 1952 itself we set up the Hindustan Cables Limited (HCL) as a PSU under the control of the Ministry of Industry. The early start is indicative of the fore-sigh and patriotism of the then Telecom leadership. The HCL produced a variety of dry core cables for subscriber pick-up and inter-exchange junction links . It took up production of large and small tube co-axial cables for our intercity transmission systems and then went on to produce the jelly-filled cables for subscriber pick-up and junction. All of these products came not out of indigenous research but totally by foreign collaborations from all quarters of the world; just like in case of switching. Although HCL was under the administrative control of the Ministry of Industry, the technical control, direction and decision were form the P&T/DOT, with all but the current Chairman & Managing Director having always been DOT’s telecom engineers !

4.3 The production was sufficient and the HCL could always give no ‘objection’ Certificates for whatever cables the DOT ever wanted to import form Japan, Korea, Canada, Denmark, Sweden, Finland – the same story as that of telephone switches. Many were the relaxations the DOT gave in regard to quality and specifications although there used to be duels between the monopoly buyer and the monopoly producer. The sufferer both by way of costs and quality was the Indian telecom network. (Even when a token penalty was imposed for substandard cable supplies the quality as per specifications, did not come forth. The inability of HCL and the care that it has for quality was most evident when HCL and the care that it has for quality was most evident when HCL could, for a long time, not meet the specifications for jelly-filled cables while a rival producer in the private sector could. The prices allowed to the HCL by the DOT were on the principle “cost plus” – a cosy arrangement at the cost of subscribers.

4.4 Fortunately, the de-monopolisation of cables was more easily allowed than competitive production of telecom equipment(HCL is Ministry of Industry’s and ITI is DOT’s baby). Even in cables, large sized (400 pairs and above) jelly-filled cable production was for long denied to the private companies. Just like production of large-sized switches.The conclusion is inescapable that government monopoly must be upheld, no matter imports are necessary to make good shortages and all this in the name of the PSUs occupying commanding heights of industry and economy (to the benefit of foreign private sector) One good consequence of cable production de-monopolisation is a surplus of installed capacity and possibility of true competition provided the monopoly buyer plays fair.

5. Customer Premises Equipment
5.1 The production of customer premises equipment (telephone instruments, PBXs, Plugs and sockets, teleprinters, Modems, FAX machines, answering and all logging devices, pay-phones, STD-barring devices, etc.) too were held to be the sole and exclusive privilege of the DOT (ACT 1885 and IPR 1956). How ridiculous it was that electrical sockets and plugs could be produced by private companies but telephone sockets and plugs were not allowed to the private sector? What a farce it was that even electronic PABXs could be produced by private companies but low-tech manual PBXs should be produced by DOTs Telecom Factories only! The first assault on the DOT’s monopoly over production of telecom equipment was launched in the CPE segment and that too by the Department of Electronics and that is why it succeeded.(DOE was always held by the Prime-Minister and DOT which earlier i.e when DOE was not there, was held by Ministers of Cabinet rank, Rafi Ahmed Kidwai, Jagjiwan Ram, Satyanarayan Sinha, Ram Subhag Singh, S.K.Patil, Dr. P. Subba Royan, Asoke Sen, Brahmananda Reddi, Shankar Dayal Sharma etc. since the 1980s for much of the time it is headed by Ministers of state ( V.N.Gadgil, R.N.Mirdha, G.Gomango, Sanjay Singh, Rajesh Pilot, Sukh Ram rank. As the CPEs were getting electronics-based, DOE wanted to promote their production in enterprises spawned by it- the more than 15 State Electronic Development Corporation (GCIL, NELTRON, KELTRON, KEONICS, WEBEL, PCs among the more successful ones). The GCEL did produce an electronic telephone but the DOT would not pass it, it was given up. A private company in Bangalore produced an electronic telephone. DOT would not have it but it is bought by Defence and Railways. Finally, the DOE admitted three foreign technologies each for telephone instruments as well as PABXs. What a pity that the exclusive privilege holder ( Act 1885 & IPR 56 umbrella) even after 40 years “self-reliant” exercise had to watch a DOE take over he initiative of multi-sourcing the CPEs ! And precisely at this time, the ITI also went in for foreign collaboration to produce an electronic telephone, is any comment necessary on the strength of R&D in DOT/ITI? The question whether any other department in India did better than DOT is not relevant for they did not have the Act 1885 and IRP 1956 privileges.

5.2 Now, anybody may produce CPE. May be customers can buy them and own them. But who would allow them to connect to the Telecom net-work? It is DOT. This is another painful story- the story of type approvals. There must be and there is a distinction between specifications for quality and performance to connect to a network like telecom on the one had and durability and non-network related functions of a customer-owned, provided and maintained CPE. When there are several producers and suppliers of CPE, then the network owner, DOT must lay down interface specifications for others products sought to be connected to its network besides quality specifications for what it wants to buy. Unfortunately DO has done poorly in regard to eh former to the distress of non-DOT producers of CPEs.

- What are and are there interface specifications for CPEs? Wherefrom can they be obtained?
- To whom should the CPE producer apply? Is there a list of tests? Who would take? In what time? And would reasons e given for rejection? What are the fees? To whom can one appeal

5.3 On satisfactory answers to these questions alone could there be thriving non-DOT CPE producers. Ask the GCEL about its electronic telephone. Ask the pay-phone enterprises. Ask the MLOE, STD – barring and other CPE entrepreneurs. They will under anonymity ( for risk of being taught a lesson) tell long tales of painful, endless and unjust experiences.The fault is in expecting a whither to monopoly supplier to be generous, objective and interested in promoting his rivals. That is unnatural here in India as elsewhere. The British Telecom after its privatisation and its being subject to competition was required to give type approvals to its rivals products for connection to its network. Few approvals came. It could not be trusted. The government had to constitute an independent organ, the British Board Approvals for Telecoms (BABT) under the Department of Trade and Industry (DTI). And now there are hundreds of type approvals and a thriving CPE market and real customer choice. In India too the CPE producers need to ask for and get one such non-DOT type approvals body it they don’t want to be suppliants, sufferers and “tarkeeb” (device, intrigue) resorters.

6. The New Economic Policy (NEP) & Telecom equipment Manufacture:
6.1 We need not go into the wisdom or need of the NEP but only its consequences on telecom equipment production. Here they are :
- Beside CIT-Alcatel’s E-10B, we have its OCB 283 version.
- We have in addition the Ericsson, Siemens, AT&T and NEC/FUJITSU digital switches
- If these foreign big switches come, when and how can the C-DOT’s development of a big switch be ensured?
- We don’t have indigenous transmission technologies. Surely there is a great need for transmission systems. So there have to be joint ventures and foreign direct investment. Would the Indian enterprises still thrive and could they persist in local design and development and compete with foreign direct supplies (imports) or joint ventures?
- How long could indigenous products like the 2 /15 series of rural radio systems survive in the face of superior products like the point to multipoint TDMA radio (of S R Telecom of Canada, SEL of Germany, NEC of Japan etc)?

6.2 The situation is: the Indian customers want service; there is not enough Indian production: there are no Indian designs for several equipments and systems. If under the NEP we overcome all these shortages how would India’s long term interests of indigenous capability and global competitiveness be built up.

We must have strategic alliances with good foreign companies not only to produce equipments we need but to grow and develop our own capability (not merely to absorb foreign technology) to design and productionise (as C-DOT did). We have no other choice. We must get over the bankrupt and corrupted ideological mind-set of administering telecoms in a totalitarian (policy+ production + service+ Regulation/ rule-making) way rather than rendering service demanded and getting rewarded (and not raising revenues by repeated rate rises).

6.3 I believe that monopoly has undermined India’s capability . The DOT with its unshaken faith in the Act 1885, IPR 1956 could not become the instrument of promotion of either telecom research or production if the past is any guide. Telecom service provision and equipment production should be separated and both must be subject to competition from people’s enterprises. That can be done by the telecoms being constituted into corporations and the Telecom Commission becoming only a policy and regulatory body. The long term goals of indigenous products in a global competitive market ( like Korea’s TDX digital switches with less than a decade) could be realised by an approach similar to what we did for development of atomic energy, space research and missiles. We can not compete with the telecom giants of the world in productions they already are masters and in which we want to make a beginning. We must identify the future telecom products-photonic switches ( which would replace electronic switches in 10 to 15 years) and related systems and work upon them through instruments like C-DOT (of 1984-88). This national effort must be funded by a cess on telecom products and services and guided by a National Telecom Equipment Council. The parallels of Korea’s KETRI (Koreas Electronic & Telecom Research Institute) and Korea Information Society Development Institute are worth studying. Most importantly, intellectual and economic inquiries into telecoms must be conducted outside the DOT like in NCAER, Centre for Development Studies, Center for Policy Research and Center for Telecom Management and Studies.

Part-III

Post-NTP Situation

The National Telecom Policies (NTP) of 1994 & 1999 abolished the monopoly in telecom network and service provision . They promote transformation of the traditional telecommunications systems into an electronic -photonic information infrastructure for telephony, images, text, voice and data . Private operating companies were given licences . The result of competition is wonderful for consumers. There are no waiting lists; prices have come down and consumer choice has increased . But there is a disaster in regard to indigenous research, development and production of communications equipment. While Chinese and Korean governments orchestrated the development of an indigenous communications and computer industry, India failed to do so. In those countries, the liberalization and competition of networks and services came along with the development of indigenous R&D and production of communications equipments. In India, because of the lack of vision and foresight and national spirit, the DOT failed to develop indigenous companies as national champions like China has developed Huawai and ZTE. The private telephone companies in India import almost all the switching and transmission equipments required for fixed and mobile telephony and of course for the Internet . Even satellite earth stations which could have been designed and producted in India came to be imported. The score of C-DOT switch manufacturers had mostly closed down as foreign switch makers cut their prices and the C-ODT switch itself has found no preferential patrons. Like C-DOT, there was an indigenous effort in mid 1990s to develop and productionise wireless in the local loop systems corDECT. This too did not find encouragement from the DOT for quite sometime . Of late both the BSNL and private telephone companies are buying this equipment and deploying in their networks on a limited scale.

2. Now the Internet and IP telephony are revolutionizing telecommunications. Internet has become the platform for every type of communications including telephony. Soft switches can switch data as well as voice and act as interfaces between the traditional digital electronic exchanges and the Internet /VOIP network . Unfortunately, there is no effort in the country to develop these new equipments . All these are imported . The C-DOT is also languishing for want of a vision in the government . India’s disadvantage in not having a hard-ware industry will continue to affect us. How much we wish that there is a national mission to conceive and develop India’s own multi-national communications companies like Huawai and ZTE of China . Government-owned ITI is kept alive by assigning to it one third of BSNL/NTBL’s procurement orders at the (lowest) prices private sector companies quoted. The Hindustan Teleprinters has been sold to a private company. IT never developed any equipment (electronic type-writer, electronic teleprinter) on its own but went in for collaborations. The Hindustan Cables (Hyderabad ad Rupnarainpur) is as good as dead. The reason for the withering of the PSUs of the DOT is neglect of R&D effort. How can a country which does not produce knowledge, become a great power? China and Korea proposing international standards based on their R&D. The glorious initiatives in TIFR, BARC, IISC, ISRO are alas, not emulated in the DOT, the principal Ministry for telecoms. The DOT imposed an R&D cess on the licenced P-Telcos. Sizable amounts were collected but these had been misappropriated to the general budget. Such an action is reflective of the lack of a national mission and commitment to develop indigenous capability.

Courtesy: Dr.Hanuman Chowdary