01 July 2019
Huawei has announced that it has signed a deal to develop 5G networks for Russia. The deal has been signed with Russia's largest carrier MTS which has happened on the sidelines of Chinese president Xi Jinping's three-day trip to Russia. At the time of the announcement, Jinping was present at the stage along with Russian president Vladimir Putin, Huawei chairman Guo Ping, and MTS chairman Alexey Kornya.
As part of the deal, Huawei will work with MTS with the goal of developing 5G network infrastructure by 2020. This is a crucial deal for both the parties involved as 5G is set to power all sorts of connected devices around the world. These will include smartphones, tablets, robots, self-driving cars, and basically anything that can connect to cellular networks. 5G will be bringing super-fast data connection as compared to the currently used industry standard of 4G LTE.
The deal has more significance for Huawei as it has found itself in the middle of the messy trade war between the United States and China. It was all set to supply equipment to US telecom carriers but because of its reportedly close ties with the Chinese government, the US decided not only to abandon the project but also imposed a ban. It has stopped all US-based companies from trading with Huawei in any way citing national security reasons. If any company does want to deal, it will have to obtain special permission from the American government. Even though Huawei denied all these claims and is even ready to sign a "no-spy agreement", the US does not seem to be ready to believe any of those.
On another hand, Russia is not bothered about what the US thinks of Huawei. It also seems to be okay with the issues Huawei will have to face because of the ban which primarily includes supply chain problems. Even though Huawei said that it has created a buffer of crucial network components and other hardware parts for such a situation, industry experts believe it will eventually have to face the elephant in the room.