It is unclear how much longer New Delhi can delay a decision on Huawei’s role in India’s 5G network. Pressure from both Washington and Beijing has left India in an uncomfortable position whereby a decision will inevitably provoke fury from at least one global superpower, and as such has led New Delhi to kick the can down the road. But uncertainty is immensely disruptive to business. This is especially so in the telecoms sector for whom long-term investment cycles are currently on hold, delaying the roll out of 5G and the subsequent economic benefits India is forecasted to reap. It is, therefore, a decision that Modi will have to face head-on sooner or later. As he does so, he would be wise to draw upon lessons from the UK’s policy shift.
At its heart, the UK government’s decision was based on the fact that the sweeping US sanctions which ban Huawei from using software and technology that originated in the US would be ‘highly likely’ to disrupt Huawei’s basic ability to supply operators. The latest bout of US sanctions amount to a declaration of war on Huawei’s existence in the international market, with the UK’s National Cyber Security Centre (NCSC) assessment anticipating a time- of decades for Huawei to completely re-design and re-build their equipment independent of US technology – a delay exacerbated by the fact China’s own semiconductor industry lags behind the West.
Much as it has done in the UK, the move by the Trump administration forces the hand of Indian policymakers. Whilst much publicised security fears had already cast doubt over the role of Huawei in India’s future 5G network, these recent sanctions leave India with little room to deviate from the Trump administration’s move to decouple from China in this strategically important sector. This US pressure is unlikely to ease under a Biden Presidency. In an increasingly polarised political climate, getting ‘tough’ on China is one of the few issues that receives bipartisan support from Democrats and Republicans, and if the sanctions imposed on 15 May fail to have their desired effect it is highly likely that they would be followed-up by further measures. In short, it is difficult to see how India can partner with a company that the US is determined to destroy.
If India is to exclude Huawei from its 5G network, it will do so from a strategically stronger position than the UK. Boris Johnson has been unable to proceed with an immediate and outright ban and has instead been forced to adopt a gradual phase-out approach for Huawei technology because of a lack of vendor diversity within the telecoms sector. Despite the UK’s NCSC acknowledging that the risk is ‘sufficiently high… to recommend that Huawei’s post-FDRA equipment is not used in the UK at all’ it stated that given the lack of alternatives ‘excluding Huawei from fixed networks will likely pose a greater resilience and security risk than their inclusion’, hence the transition period. Other than Huawei, only Nokia is able to supply national fibre access networks to the UK, and it is this lack of diversity amongst 5G vendors which increases the likelihood that single points of failure would compromise vast swathes of the UK network. India’s more diverse 5G ecosystem means that it is in a position to exclude Huawei completely: Ericson, Nokia and Samsung are all potential alternatives, thus mitigating the risk of an equipment-enabled cyber-attack. Moreover in a few years, Reliance Jio – spurred on by investment from Silicon Valley – is predicted to be in a position to make its 5G infrastructure widely available.
Yet banning Huawei does not guarantee a secure 5G network, not least because China is not thereby removed from the complex global supply chains. Chinese companies play an extensive role in making 5G kit even when the primary vendor is not Chinese, for instance the prospective vendors Nokia and Ericsson both have factories in China, and if it wanted to China could infiltrate any vendors’ 5G supply chain. Plus, regardless of whether a hostile state has component parts in the communication system it can still launch cyber-attacks, and so removing Chinese technology cannot safeguard India from Chinese cyber threats: Russia does not provide any components to telecommunications networks in the UK yet it remains one of our foremost cyber adversaries. Thus, any decision to exclude Huawei must be accompanied by broader risk-management strategies that recognise that whilst China is prolific in its cyber-attacks, it is just one of many hostile forces that could compromise the integrity of the 5G network. Indeed, poor network designs that are vulnerable to attack from any hostile actors are a far more pressing concern for Indian security officials than state-sanctioned backdoors.
In this regard, the much awaited Cyber Security Policy 2020 will be critical to strengthening the resilience of India’s future 5G network. It should recognise that whilst it is impossible to guarantee the complete security of 5G networks, carefully coordinated risk-management measures can significantly mitigate the threat from hostile actors. Network segmentation, rigorous testing of equipment such as that performed by the UK’s Huawei Cyber Security Evaluation Centre (HCSEC), and strict supervision of vendors’ access to network are all safeguards that can be implemented to strengthen the integrity of the 5G network. More broadly India should look to the UK and recognise the value of close intelligence sharing and collaboration, with the UK in a stronger position to confront China’s sophisticated cyber-attacks in partnership with its 5 Eyes allies.
In the longer-term India will have an important role to play in tackling the oligopolist 5G market which has severely reduced the commercial incentives for vendors to improve their services, and, as discussed, has created significant security vulnerabilities. As Boris Johnson alluded to, the West is in this predicament because of a failure to produce a safe alternative to Huawei in the telecoms market and India has a vested interest in supporting the UK’s calls for a collective effort amongst D-10 partners for an industrial strategy that can diversify the international telecoms market. The death of countless telecoms companies - from Nortel to Marconi - is testament to the difficulty of operating in this high volume, low margins market where there is little room for error. To succeed will require liberal democratic states to be more sharing with their technology, more willing to collaborate across borders, and more prepared to invest in strategically important areas. In this regard both India and the UK have opportunities to seize, particularly in the university sector. Short of D-10 collaboration, India may find that a sovereign capability in this technology area is the only way forward.
Ultimately, whilst Modi will have to weigh up the merits of Huawei’s involvement against security criteria, he will struggle to divorce his final decision from geopolitical, economic and ideological factors. A ban on Huawei would be interpreted as a pushback against China’s irresponsible behaviour in the region but can be expected to escalate further India-China tensions. The UK currently faces being frozen out of future Chinese investment as a direct result of its decision, but with India accounting for a much larger percentage of China’s trade, and with India’s enormous trade deficit with China, such threats are unlikely to materialise if India were to block Huawei. Then there are ideological concerns about Chinese technology companies being at the forefront of the 4th Industrial Revolution and the prestige that this would confer on an authoritarian regime that commits gross human rights abuses. As with the UK, it is this symbolic importance of the decision which will be of greatest consequence.
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