DoT seeks additional funds for alternative network project

DoT seeks additional funds for alternative network project
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First Published: Sat, Mar 08 2008. 12 44 AM IST
Updated: Sat, Mar 08 2008. 12 44 AM IST
New Delhi: The department of telecommunications (DoT) has made a fresh request for additional funds from the Union government for an alternative telecom network project to which India’s defence services will switch to for their communication needs and vacate scarce airwaves they currently use, which is required by private firms such as Idea Cellular Ltd for offering commercial mobile phone services.
Even as Bharat Sanchar Nigam Ltd (BSNL) readies a 5,200km optical fibre network for the Indian Air Force (IAF) by the end of this year, the army and navy are yet to submit their needs to the state-run firm, which could further push the release of additional spectrum by defence forces to early next year.
“The department has sought additional funds (for this) from the cabinet,” confirmed a senior DoT official, who requested anonymity.
While the official declined to elaborate as to how much additional funds are required, another department official close to the development estimated that the first phase of the project would cost around Rs1,200 crore.
India’s biggest phone firm by revenues, BSNL, which was asked by the government to set up an optical fibre cable network for the defence authorities, has already spent around Rs500 crore and has received just around Rs50 crore from DoT so far.
“We have asked the department to release additional funds,” said Kuldeep Goyal, chairman and managing director of BSNL. “We will havean operational network ready for the air force by December this year.”
A ministry of defence spokesperson declined to provide any specific details about plans for vacating the radio spectrum.
“A technical committee will be presenting its observations to the group of ministers; we cannot offer any comment before that,” he said.
Telecom experts such as Varadharajan Sridhar of Management Development Institute, Gurgaon, said the finance ministry and DoT coulddip into the universal service obligation (USO) fund for such projects. “USO fund has over Rs10,000 crore in cash,” Sridhar said.
“Alternatively, the government may also want to set up another fund focused on licence fee and spectrum charges collected from (mobile phone) operators.”
The air force network involved setting up a state-of-the-art communication systems by BSNL such as multiprotocol label switching (short for MPLS), which enables high-speed data transfers. “The MPLS part alone is estimated to cost Rs600 crore,” Goyal added.
The Indian Air Force could release as much as 40MHz of scarce radio spectrum needed by DoT to accommodate new telecom aspirants such as real estate firm Unitech Ltd apart from Datacom Solutions Pvt. Ltd, a unit of consumer goods maker Videocon Industries Ltd.
The second phase of the project could cost an addi-tional Rs1,200 crore if the defence authorities do not share infrastructure at common locations.
“The air force network covered almost 160 stations, and we expect the army and navy networks to have at least 250 and 30 stations, respectively,” said the DoT official, who did not wish to be named.
“There would be several common stations, and we hope they will be sharing these points,” he added.
Meanwhile, telecom aspirants seeking to enter the lucrative Delhi market can expect radio spectrum in few months, as state-run Mahanagar Telephone Nigam Ltd (MTNL) has almost finished setting up an alternative communication network for defence authorities in Delhi. “We are nearing completion and should ready the alternative network within a couple of months,” said an MTNL official, who did not wish to be named.
As many as nine new firms such as STel Ltd, Shyam Telelink Ltd, Swan Telecom Ltd, Loop Telecom Pvt. Ltd (a subsidiary of BPL Telecom), Spice Communications Pvt. Ltd, Tata Teleservices Ltd and Idea Cellular, besides the units of Unitech and Videocon Industries have procured licences with no promise of radio spectrum to start their services in the country.
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First Published: Sat, Mar 08 2008. 12 44 AM IST
More Topics: DoT | Telecom | Mobile network | Defence | Spectrum |