BSNL to raise 3G toast in $5 bn GSM tender

3G is an advanced version of today’s communication links which will give first-movers a lion’s share of the high investment-high returns business. BSNL believes that nearly 50 per cent of its new network of 60 million lines may be 3G-enabled by 2009.

Company executives said today that though 3G spectrum is yet to be given or auctioned and though 3G licences are not codified by government yet, not going for 3G is not an option.

‘‘We have indications from government that 3G spectrum will be released soon, maybe by May or June. We know 3G needs a licence, but since deployment is not expected before the year end or next year we foresee no conflict,’’ said BSNL CMD A.K. Sinha.

This capacity for advanced high-speed data and voice network may go up to 50 per cent by 2009, making it one of the world’s biggest 3G networks, he said. The 3G network is to be concentrated in major cities.

The Rs 20,000 crore tender will also target expansion in new towns and cities with a population below 2,000. ‘‘All villages with populations over 5,000 will be covered this year. Around 50 per cent of the new equipment will go to rural, virgin and small towns,’’ said BSNL Director Finance S.D. Saxena.

The per-line cost is estimated at Rs 3,400 by BSNL and bidding is to begin in a month, deployment at the end of the year provided all goes well.

BSNL’s GSM tender will cater to the East, South and North zones, where 45.5 million lines are up for offer. The West Zone’s 18 million lines are to be deployed by ITI and Alcatel, as PSU quota.

In the first year, vendors can import equipment or build-up from imported components locally, but in the subsequent (two) years, 33 per cent manufacturing of the core equipment for the tender must be done in India.