Telecom seeks manufacturing, private 5G push in Budget 2026-27

As the Union Budget 2026-27 approaches, leaders from India’s telecom and digital infrastructure ecosystem are urging the government to sharpen its focus on domestic manufacturing, private 5G deployment, and deep-tech innovation.

With telecom networks forming the backbone of India’s digital economy, from industrial automation to strategic communications, industry executives say the upcoming budget is a critical opportunity to strengthen indigenous capabilities and reduce import dependence.

Make in India and Supply Chain Resilience

Industry voices argue that while India has made progress in expanding network coverage, the next phase of growth must centre on strengthening the telecom manufacturing value chain. Paritosh Prajapati, CEO of GX Group, said Budget FY26 should reinforce the government’s Make in India agenda by prioritising telecom manufacturing, research and development, and digital infrastructure.

“With the government’s continued thrust on Make in India, we expect Budget FY26 to prioritise telecom manufacturing, R&D and digital infrastructure,” Prajapati said. “A phased manufacturing programme for telecom equipment can strengthen supply chains and accelerate domestic production.”

He added that targeted incentives would be essential to support critical segments such as electronic and photonic components, optical transmission equipment and export-oriented manufacturing clusters. According to Prajapati, policy support for domestic design, testing and certification capabilities would also help Indian manufacturers compete globally and position the country as a reliable hub for next-generation telecom infrastructure.

Private 5G as Industrial Infrastructure

Beyond manufacturing, executives are calling for clearer policy frameworks to accelerate enterprise adoption of private 5G networks. As India transitions from pilot projects to large-scale industrial digitisation, private 5G is increasingly seen as essential infrastructure for sectors such as mining, ports, manufacturing and logistics.

Ankit Dixit, Founder and CEO of Tidal Wave Technologies, said Budget FY26 should formally recognise private 5G as critical infrastructure and address long-standing uncertainties around enterprise spectrum access.

“As India moves from pilots to industrial-scale digitisation, Budget FY26 should recognise Private 5G as critical infrastructure for sectors such as mining, ports, manufacturing, and logistics,” Dixit said. “Greater clarity on enterprise spectrum frameworks and support for Indian OEMs building core 5G IP will be key to accelerating adoption.”

Dixit also highlighted the need for dedicated budget allocations for public sector undertakings (PSUs) to conduct paid technology trials with domestic suppliers. He argued that such a move would reduce over-reliance on free proof-of-concept deployments, speed up adoption of advanced infrastructure and improve accountability.

“Allocating dedicated budgets to PSUs for paid technology trials, when executed by DPIIT-recognised Make in India companies, can significantly reduce reliance on free PoCs, speed up deployment of cutting-edge infrastructure, and improve accountability on both sides,” he said.

Optical Transceivers and Deep-Tech Gaps

At the component level, deep-tech manufacturers are urging the government to address structural challenges that hinder domestic innovation. Optical transceivers, a critical building block for telecom, data centres, transport and defence networks, remain heavily import-dependent despite their strategic importance.

Tarun Sibal, CEO of CloudPhotonix India, said low national R&D spending and policy distortions were limiting the growth of indigenous capabilities.

“Ahead of the Union Budget, we highlight that optical transceivers are foundational to India’s digital, telecom, transport, defence and strategic communications infrastructure,” Sibal said. “However, domestic deep-tech manufacturers face systemic challenges, including low national R&D spending at around 0.6 percent of GDP and a zero-duty import regime that distorts market access.”

Sibal called for clear HSN classification, a graded duty structure, and concessional input duties, along with procurement preference for Indian-designed and manufactured optical transceivers in government and PSU projects.

Budget 2026-27 as an Inflection Point?

Collectively, industry leaders see the upcoming Union Budget as a potential inflection point for India’s telecom sector, one that could move the country beyond network rollout towards long-term technological self-reliance.

With rising global demand for secure, high-capacity networks and growing geopolitical focus on trusted supply chains, the sector believes targeted fiscal and policy support could help India emerge as a global telecom manufacturing and innovation hub.

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