HUAWEI, THE TELECOM GIANT AND THE POLITICAL CONTROVERSY.                                                                                                                     K G Jayaraj


It was a shocking news to the world that Ms.Meng Wanzhou, Chief Financial Officer , Huawei was arrested in December, 2018 by the Canadian government at the behest of USA. Ms.Meng is none other than the daughter of Ren Zhengfei, the founder of Huawei. The allegation by USA is that she and Huawei conspired to dodge the American sanctions against Iran and faces extradition. The firm is also accused of trying to steal trade secrets from T-Mobile, an American subsidiary of Deutsche Telecom.Donald Trump also asked his allies to disassociate with Huawei and that is how Canada arrested Meng Wanhou. But other countries including Britain have rejected the US plea. On the contrary, the UK government took a cabinet decision in April, 2019 to allow Huawei to build next generation infrastructure in Britain. Naturally this will invite the wrath of Donald Trump against the Theresa May government. But the decision is generally appreciated  as a balanced stand far from being a betrayal. It is felt that Britain’s approach of using the Huawei’s gear on the edges of 5G network, under close supervision, offers a sensible framework for limited commercial engagement while protecting the security of Britain and its allies.

 Now, USA has banned Huawei citing security issues. This is nothing new. Another Chinese technology firm ZTE was banned in 2017 from doing business with American firms. The consequences were severe that ZTE was forced to stop production as it relies on technology from US firms such as Qualcomm, a chip maker and Google which develops Android, a smart phone operating system. However ZTE was saved from serious crisis after Donald Trump, US President had to agree with Xi Jinping, his Chinese counterpart, to lift the ban.


Huawei has a humble beginning in 1987. It started with importing telephone switching gear from Honkong and reselling, of course at the bottom of the value chain. Its rise is better compared to China which has grown as the number two economy of the world within a short period. Now, its products- from smartphones to solar panels are sleek, high tech and competitive with any products of its rivals. In a nutshell, Huawei and its mother country, China have become the technological pacesetters in their own right. Naturally it has reflected in its revenues which rose to $105bn in 2018. The firm has a work force of 80,000 in research and development alone. In 2018 China has filed 53,345 patents just behind USA’s 56,142. Of China’s , around one in ten came from Huawei.

Huawei’s ascent, like that of China , has caused a good deal of worry elsewhere in the world. For the last three decades, the firm is still in telecoms-equipment business. Huawei has become one of the world’s biggest suppliers of high-tech kit used to build mobile phone network along with Nokia, a Finnish firm and Ericson, a Sweedish company. However Huawei has been most active in setting the technical standards for the fifth generation-5G- network. These promise big increases in speed and capacity that will improve some existing technologies such as connected cars, and make possible new ones. So, Huawei and China sit at the heart of technologies. This has naturally become a critical piece of future national infrastructure for other countries in the world, particularly the US imperialism. So, Donald Trump has taken such a harsh step of ban not on security issues but out of jealousy and frustration. Actually, no evidence of spying by Huawei has been made public and most emerging economies have no intention of prohibiting Huawei. A ban by a few American allies risks splitting the world in to two blocs. The decision is  also connected to the current trade war initiated by Donald Trump against China and other countries. And as in the case of ZTE Donald Trump will be compelled to lift the ban on Huawei sooner or later.


The development program of BSNL in the mobile segment was scuttled during the 1st UPA government by not allowing BSNL to procure the equipments from Huawei, which has quoted the lowest price, citing security issues. The irony was that Huawei equipments were allowed to be procured by private telecom companies and the telecom installations at PMO(Prime Ministers Office) were that of Huawei. We, the BSNL people know well that Huawei opposition was just a ploy to deny the advancement of BSNL for the sake of private telecom companies.  And this was the first deleberate attack on BSNL by the government itself which paved the way for the decline of BSNL.