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China's Huawei to meet Indian officials on telco gear-paper

business Updated: May 04, 2010 12:24 IST

Senior executives from China's Huawei Technologies will meet top Indian officials this week to help allay concerns about any security threats posed by the use of its telecom gear in the booming Indian market, the Economic Times reported on Tuesday.

Last week, the world's second-largest telecommunications equipment maker had said it was seeking clarification from authorities after reports that India was blocking purchase of telecoms gear from Chinese vendors, an issue that could stoke trade tensions between the two Asian giants.

India started overhauling its security system after Islamist militants killed 166 people in a 3-day attack in the financial hub of Mumbai in November 2008. The militants used a satellite phone while travelling to Mumbai by sea and kept in touch with their handlers in Pakistan on mobile and Internet phones.

The Indian government has made it mandatory for telecom firms to get security clearances from the telecom ministry before placing any equipment purchase orders, and in the past has restricted the use of Chinese-made telecoms equipment in sensitive border areas.

Huawei has told the government that its equipment poses no security threat. The Chinese firm also said it is restructuring operations and the chairman and board of directors of its Indian arm would all be Indian residents, The Economic Times said, citing an unidentified person with knowledge of the development.

The chief executive of Huawei's Indian unit in a letter to T K A Nair, the PM's principal secretary, said that 85 per cent of its staff and nearly all of its research workforce were Indians, the newspaper reported.

"The Indian operations have been cooperating with the Indian government agencies and have given all the information that has been sought," it quoted the letter as saying.

A spokesman for Huawei in India said he could not immediately comment on the matter.

Both Shenzhen-based Huawei and fellow Chinese rival ZTE are active in India, which is adding mobile subscribers at the fastest pace in the world and is the second-largest wireless market after China.

Huawei more-than doubled its India revenue during the year to March 2009 to 62.4 billion rupees ($1.4 billion), according to data compiled by technology publisher CyberMedia.