BSNL union paints dire picture if contract delays are unresolved

BSNL union paints dire picture if contract delays are unresolved
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First Published: Sat, Jul 14 2007. 04 07 AM IST
Updated: Sat, Jul 14 2007. 04 07 AM IST
New Delhi: The employees union of the state-owned communications provider Bharat Sanchar Nigam Ltd (BSNL) is worried that any delay in issuing purchase order to vendors LM Ericsson and Nokia Siemens Networks for GSM connections would make it impossible for the telecom public sector undertaking to provide new connections.
The delay stems from new communications and information technology minister A. Raja asking for a review of the entire tender process.
“We will soon be unable to give new connections as our capacities have saturated. Already, in many places, we have given out connections over our capacity by using disconnected lines as we are flooded with requests for connections that we are unable to meet,” said V.A.N Namboodri, the general secretary of the BSNL Employees Union, which had led a national strike on Tuesday.
According to the union, the network is already grossly overburdened, affecting the quality of service and resulting in customers opting for private suppliers. A senior BSNL official involved with network and capacity planning, however, said the company can temporarily continue to grow its subscribers at the current rate of around 0.8 to 1 million per month.
“The contract gives a lead time of six to eight months for the equipment companies to bring the capacity online after it is awarded,” said the official who didn’t want his named used. “We can still manage to add at the current rate for the next six to eight months. But, any further delay will seriously impact our plans to increase the addition rate.”
Industry experts and analysts, however, played down chances of any immediate threat to BSNL’s current rate of adding one million subscribers every month. “If there is a capacity of 1,000 users, people do accommodate 1,200 to 1,300 on it after upgrading the capacity of the switch by paying extra royalties to the vendor who installed it,” said a telecom industry analyst with a consulting firm, who did not wish to be identified.
“While the switch capacity can be taken care of like this, the radio (spectrum) capacity will still be a problem unless new base stations are put in, and this can result in poor quality of service and congestion,” the analyst added.
Meanwhile, Namboodri alleged that the company will not be able to cater to the demands for new GSM connections after a few months due to the delay in issuing a purchase order for the 45 million new lines, the contract for which was awarded to Nokia and Ericsson last year.
BSNL has posted a huge decline in the number of subscribers it has been adding every month since the end of March. While it added around two million subscribers during March and a little more than 10 million during the full year, the subscriber additions dropped to 0.33 million during April and further to 0.24 million in May and 0.429 million ast month.
“The private players in the GSM market will completely take over the market. This is a question of our survival and we simply had to strike,” Namboodri claimed.
The tender for GSM connections was awarded to Nokia and Ericsson in October last. Motorola challenged this award, but withdrew its case in April this year.
But Raja expressed his displeasure at the per-connection rates at which the contract was finalized and the fact that Motorola was not considered for the deal.
The unions now say that the red tape would result in BSNL losing customers all over the country. “We are not concerned about the tender. We want the connections at the earliest,” said Namboodri.
narayana.k@livemint.com
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First Published: Sat, Jul 14 2007. 04 07 AM IST