Amid hardships in the US and the UK, China’s Huawei is likely to witness further revenue problems as the world’s second-biggest mobile market is also inching closer to cut the company’s telecom presence on their land. Financial Times (FT) relies on the industry executives to cite the border tension between New Delhi and Beijing as the reason for the attempts to phase out the telecom giant.
Key quotes
India is phasing out equipment from Huawei and other Chinese companies from its telecoms networks over an escalating border dispute, striking a fresh blow to the beleaguered technology giant in one of its most important markets.
New Delhi has not issued any formal written ban on Chinese equipment suppliers like Huawei and ZTE, nor has prime minister Narendra Modi’s government made any such public pronouncements.
However, industry executives and government officials say key ministries have clearly indicated that local telecom service providers should avoid using Chinese equipment in future investments, including in 5G networks.
“It’s open now that the government is not going to allow Chinese equipment,” a top telecom industry executive told the FT. “There is now clarity… It’s really game over.” India’s telecoms department, the executive added, “has already disallowed 5G testing with Chinese vendors”.
Huawei has been one of the three biggest telecom equipment suppliers in India, which is the world’s second-biggest mobile market, with more than 850m users. It has had significant contracts with Bharti Airtel, Vodafone and state-owned BSNL.
FX implications
News like this portrays the Sino-American tussle and should ideally weigh on the market’s risk-tone sentiment. However, the latest risk-on mood is yet to get vanished and hence S&P 500 Futures kick-starts Tuesday on the positive side above 3,400.
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