Global surveillance equipment manufacturers have found themselves in a tense standoff with Indian regulators over the country’s newly enforced security rules for CCTV cameras. Under these new directives, effective from April, manufacturers are required to submit not only their hardware and software but also sensitive source code for government lab assessment, prompting concern and resistance across the industry.

Safety Concerns Fuel Policy Shift

India’s move stems from rising apprehension over foreign surveillance technology, particularly from China. Officials say the updated rules are necessary due to fears of cyber espionage. A senior Indian policymaker linked the decision to growing worries over China's surveillance reach and data security implications. In 2021, it was revealed in Parliament that around one million cameras used in Indian government facilities were sourced from Chinese firms, with some data being transferred to offshore servers. Gulshan Rai, India’s former cybersecurity chief, reinforced these concerns, stating, “There’s always an espionage risk. Anyone can operate and control internet-connected CCTV cameras sitting in an adverse location.”

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Mandatory Lab Testing Introduced

According to official documents and emails reviewed by Reuters, a media organisation, companies such as China’s Hikvision, Dahua, and Xiaomi; South Korea’s Hanwha, and America’s Motorola Solutions must now comply with this policy. The rules apply to all internet-connected camera models manufactured or imported from April 9 onwards. 

At a meeting on April 3 involving 17 surveillance companies—including Bosch, Honeywell, and Xiaomi—industry representatives urged Indian authorities to delay enforcement, citing lack of readiness. The request was denied. Meeting minutes reveal that officials insisted the rules “address a genuine security issue” and were non-negotiable.

Supply Chain Disruption & Financial Strain

Executives warned that the policy could cause significant disruptions. In an email dated April 9, Ajay Dubey, Hanwha’s South Asia Director, warned the IT ministry that the rule could result in “millions of dollars lost”, potentially sending shockwaves through the market. Other firms echoed the concern, flagging delays in product approvals and project slowdowns. Insufficient testing infrastructure, repeated factory audits, and source code demands were cited as major roadblocks.

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India’s Surveillance Boom

With CCTV camera adoption surging, particularly in urban centres, the Indian market is on track to more than double from $3.5 billion in 2024 to $7 billion by 2030, according to Counterpoint Research analyst Varun Gupta. China’s Hikvision and Dahua currently hold a 30% market share, while India’s CP Plus commands the lead with 48%. Notably, around 80% of CCTV components in India originate from China.

Limited Approvals Slow Progress

Only a small fraction of the industry’s estimated 6,000 camera models have passed India’s certification process. According to Gupta, public sector demand accounts for about 27% of the market, while the private sector, including industries, hotels, and homes, covers the rest. Companies such as Motorola Solutions, Hanwha, and Norden Communication have informed Indian authorities via email that only a limited number of models have received necessary approvals.

China Targeted Without Being Named

India has not officially named China in its new policy. However, geopolitical tensions and border clashes since 2020 have led to bans on Chinese apps like TikTok and tighter investment rules for neighbouring countries. A senior Indian official stated that the new rules stem from concerns about surveillance equipment vulnerabilities, particularly regarding Chinese products. The U.S., U.K., and Australia have previously banned or restricted Chinese surveillance devices on similar grounds.

India has reportedly imposed stricter submission guidelines for companies from nations it shares a border. Xiaomi, for instance, revealed that Indian labs declined to proceed with testing unless it submitted more registration details from its China-based contractors. India's Standardisation Testing and Quality Certification (STQC) Directorate, which oversees surveillance device certification, has 15 labs capable of processing 28 applications simultaneously. Each application can include up to 10 camera models.

As of May 28, 342 applications covering hundreds of models were pending—237 of them classified as new submissions. Only 35 applications had been fully tested, just one of which came from a foreign manufacturer. While Indian brand CP Plus has secured clearance for some flagship models, others are still awaiting approval. Bosch, too, has submitted products and urged authorities to allow interim sales to prevent business disruption.