Home Army Technology Huawei takes 5G fight to India and Pakistan – Nikkei Asian Review

Huawei takes 5G fight to India and Pakistan – Nikkei Asian Review

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MUMBAI – Huawei is pushing cash-strapped South Asian nations to adopt its low-cost 5G technology as the tech behemoth moves to fend off U.S. claims that it’s a proxy for Chinese spying.

Already well-positioned in Pakistan, Bangladesh and Sri Lanka, Huawei is intensifying its efforts to allay Indian concerns over the company’s perceived ties to the Chinese army before the start of 5G trials there later this year.

“Go digital, not political, is a choice that serves the interests of all stakeholders,” a spokesman for Huawei Southeast Asia, which includes the Indian subcontinent, told Nikkei Asian Review. “We will try our best to complete the trial for customers, and work together with industry partners to push forward the 5G ecosystem.”

India, Pakistan and Sri Lanka are all aiming for the commercial deployment of 5G services in the second half of next year, with Bangladesh more likely to launch its 5G network in 2021.

Home to one quarter of the world’s population, with mobile internet penetration forecast to rise to around 61% by 2025, the region is a potential gold mine for 5G equipment makers such as Huawei which last week reported soaring revenues of $105 billion for 2018.

Still, U.S. pressure on allied countries to bar Huawei from its 5G networks has begun to affect the the company. It’s carrier business declined 1.3 percent last year, and this week Britain’s IHS Markit said Huawei had fallen behind Sweden’s Ericsson as the world’s largest telecom equipment maker.

“In India, the policy ambiguity surrounding Huawei’s participation in 5G trials, is casting a shadow over operator readiness,” Prabhu Ram, head of industry intelligence at Cyber Media Research, told Nikkei. “The government is expected to examine all security related issues before allowing Huawei to take part in 5G trials in India.”

The company is in a much stronger position across the rest of South Asia, Ram added, where “it has demonstrated 5G in countries such as Bangladesh and Sri Lanka and both countries remain amenable to it, with no security concerns.”

Bangladesh Telecommunications and Information Technology Minister Mustafa Jabbar praised Huawei’s role in his country’s telecom infrastructure at the Mobile World Congress in Barcelona in February, while Sri Lanka’s Minister of Digital infrastructure and Information Technology Ajith Perera said he had no concerns using Chinese technology, with Huawei’s solutions and equipment already being used by 70% of Sri Lankans.

“Business and politics are two different things,” Perera told the Colombo Gazette last month. “Sri Lanka has successfully and safely been using Chinese products including Huawei in a big way.”

Close links between Beijing and Islamabad are also expected to boost Huawei’s 5G ambitions in Pakistan, which has already benefited from investment worth tens of billions of dollars under China’s flagship Belt and Road Initiative.

“Huawei have already established a strong presence in the Pakistani market,” a senior Pakistan Telecommunications Authority official told Nikkei. “This should give them an edge.”

According to Huawei, 5G will bring industry opportunities worth $1.2 trillion to South Asia and Southeast Asia over the next five years.

“The number of 5G subscribers will top 80 million, Internet traffic will grow by 5 times in total, more than 20 smart cities are on the way, and wireless, digital and intelligent equipment will improve social productivity by 4-8% on average,” Huawei told Nikkei.

Shrugging off U.S. accusations that it spies on behalf of China, Huawei urged countries across the region to cooperate with equipment vendors who had showed true local commitment.

“In the past decades, Huawei has carried out extensive and intensive cooperation with governments and operators, and we keep bringing innovative, leading, secure and reliable products to all countries and help them build the most advanced and secure connection services,” Huawei said.

One difficulty for many telecom providers across South Asia will be keeping prices low enough to ensure adequate consumer take-up rates.

“Attractive tariffs for 5G users will be the key to encouraging a large number of customers” Mohammad Suhail, head of the Karachi based Topline Securities Investors’ Advisory.

Charges for data services in Pakistan were higher than in many other developing world economies countries, Suhail said, with equipment outlays and the high prices for 5G spectrum expected to add to cost pressures.

Mahtab Uddin, chief executive of Bangladesh’s second largest mobile network operator Robi Axiata, which uses Huawei equipment for its services, said his company was struggling to make a profit and he has urged the government to consider cutting taxes and keeping spectrum prices low.

“All said, 5G infrastructure translates into an expensive proposition,” said Cyber Media Research’s Prabhu Ram. “Political will aside, it may potentially take a year or even much more, before 5G commercial roll-out takes place in countries such as Pakistan and Bangladesh.”

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