SingTel, Bharti in $ 650 mn cable project

The announcement comes two months after SingTel said it would invest $400 million for stakes in two Bharti group companies.

SingTel, with an estimated cash pile of S$6.0 billion bought 20 per cent and 15 per cent stakes, respectively in Bharti Telecom and Bharti Televentures, two of the firms controlled by the holding group, Bharti Enterprises, to gain a foothold in India’s fast liberalising telecom sector.

LARGEST CABLE CAPACITY: The cable network would be the world’s largest in terms of capacity with a total bandwidth of 8.4 terabits per second and carry more than 100 million conversations simultaneously.

The undersea cable venture would also sublet bandwidth to other Indian operators, with the opening up of the domestic long distance (DLD) and other international long distance (ILD) telecom sectors in India.

"This venture further reinforces our promise to the Bharti Group, of helping it roll out the latest telecommunications services in India," said Lee Hsien Yang, president and chief executive of SingTel.

He added this would be the first of many ventures SingTel hoped to work on in India with Bharti, to offer a series of top infocommunications services in the country.

Sunil Bharti Mittal, chairman and group managing director of Bharti Enterprises said the formation of the venture underscored its commitment to build telecom and IT infrastructure in India.

"The bandwidth will benefit the software industry, call centres, dotcom companies and Internet-Protocol-based industries for applications such as Web hosting.

Analysts said the investment would be a win-win situation for both companies and logical for SingTel.

Tjandra Kartika, regional telecoms analyst with broker GK Goh, said: "It’s a big investment. India is one of the big markets in the region. Given (it’s) low penetration rate compared with other markets in the region…. given the liberalisation and the size of the overall market in India, it is a good investment."

He added it was a good place to start investing as India was better than China in terms of regulations.

By midday on Tuesday, SingTel shares were up four cents at S$2.78 on almost three million shares traded.