China threatens retaliation if India bans Huawei

‘REVERSE SANCTIONS’::Although Indian firms have a relatively small presence in China, action against them could be significant and also revive territorial tensions

Reuters, NEW DELHI

Thu, Aug 08, 2019 - Page 1

China has told India not to block its Huawei Technologies Co Ltd (華為) from doing business in the country, warning there could be consequences for Indian firms operating in China, sources with knowledge of the matter said.

India is to hold trials for installing a 5G network in the next few months, but has not yet taken a call on whether it would invite the Chinese telecom equipment maker to take part, Indian Minister of Electronics and Information Technology Ravi Shankar Prasad has said.

Two sources privy to internal discussions in New Delhi said that Indian Ambassador to China Vikram Misri was on July 10 called to the Chinese Ministry of Foreign Affairs to hear China’s concerns about the US’ campaign to keep Huawei out of worldwide 5G infrastructure.

During the meeting, Chinese officials said there could be “reverse sanctions” on Indian firms engaged in business in China should India block Huawei because of pressure from Washington, one of the sources said, citing a readout of the ambassador’s meeting.

Ministry spokeswoman Hua Chunying (華春瑩) said that Beijing hopes India would make an independent decision on 5G bidders.

“Huawei has carried out operations in India for a long time, and has made contributions to the development of Indian society and the economy, that is clear to all,” Hua said in a statement.

Indian companies have a far smaller presence in China than other major economies, but firms such as Infosys, TCS, Dr Reddy’s Laboratories Reliance Industries and Mahindra & Mahindra have a foothold there in manufacturing, healthcare, financial services and outsourcing.

A potential row over Huawei could revive tensions in the broader India and China relationship just as the two sides have been making efforts to ensure their long-standing territorial disputes do not escalate.

In October, Indian Prime Minister Narendra Modi is to host Chinese President Xi Jinping (習近平) in Varanasi, his parliamentary constituency in northern India, where the two are expected to address trade issues, including a US$53 billion trade deficit in 2018-2019 that India is concerned about.

The main right-wing group tied to Modi’s ruling alliance has stepped up criticism of Huawei.

In a letter written to Modi last week, Ashwani Mahajan, head of the economic wing of the Rashtriya Swayamsevak Sangh, said that there were concerns about Huawei’s operations in India.

“We as a country are not yet sure of relying on Huawei. Globally, the Chinese companies, including Huawei, are facing allegations that they ‘underbid’ projects, and position themselves and their establishment back home to snoop and enable them to shut remotely, if required be,” he wrote.

Prasad told the legislature that six proposals have been received for 5G technology trials, including from Huawei.

He did not name the others, but firms such as Sweden’s Ericsson, Finland’s Nokia and South Korea’s Samsung Electronics are expected to participate.

A high-level group of officials has been looking into whether to open the 5G trials to Huawei.

The committee has found no evidence to suggest that Huawei has used “backdoor” programs or malware to collect data in India, the first source and another official in the Indian Department of Telecommunications said.

The Indian Ministry of Home Affairs has issued no directive to curtail Huawei’s entry, the telecom official said.

“We can’t simply reject them just because they are Chinese,” they said.

One option that a tech expert at the Indian National Security Advisory Board has suggested is to ensure that the hardware and software for the 5G network are not both sourced from Huawei.