The Department of Telecommunications (DoT) is considering advising state-run Bharat Sanchar NIgam Ltd. (BSNL) to test a domestically consolidated end-to-end network for 4G services before selecting a telecom company to upgrade its network, HT has learnt.
Such a decision could have far-reaching ramifications because the new setup, if found feasible, can be replicated by other network providers and to upgrade to 5G services, the tendering process for which is yet to begin.
HT reported on June 22 that the DoT had set up a six- member panel to look into the 4G upgrade tender after which it was scrapped on July 1. The decision came in the aftermath of heightened tensions with China, particularly since the death of 20 Indian soldiers on June 15 in Eastern Ladakh Sector’s Galwan Valley in a skirmish with Chinese soldiers.
The decision was also taken in the context of the telecom department’s preference for a Make in India option and to reduce reliance on Chinese companies such as Huawei Technologies Company Ltd. and ZTE Corporation.
The six-member panel, which has representatives from DoT, BSNL, Mahanagar Telephone Nigam Limited and industry experts, has already met five times and is in the final stage of outlining requirements for the fresh tender. The tender requirements are likely to be finalised by the end of the week. The Rs 7,000- Rs 8,000 crore tender is part of the BSNL revival package that will allow it to expand its telecom presence.
“Indian manufacturers at present do not have a turnkey setup in place,” said a DoT official who did not wish to be named. “A turnkey setup offers end-to-end network, including both radio and core requirements that are consolidated at a central level by a single operator.”
The official said while seven companies manufacture radio equipment, used to set up telecom towers, only two companies at present are capable of making core equipment, which translates the signals to provide telecom services. “The core equipment is responsible for translating the signals that are carried by the radio equipment,” the official said. “The new approach is likely incorporate multiple vendors to set up an end-to-end network.”
A member of the panel told HT on condition of anonymity that reservations had been expressed by some members of the panel about the ability of Indian tech companies to set up such a network. “We are discussing telling BSNL…to set up at least 10-20 towers using local equipment and connect it to the core,” said the member. “They can test if the equipment is giving the appropriate results.”
According to experts, nearly 75% of the telecom equipment India needs is sourced from companies outside the country. ZTE and Huawei, Nokia, Ericsson AB and Samsung Electronics Company Ltd are among the biggest suppliers. “We are not saying that Nokia or Airtel will not be able to provide services, but the idea is that the local manufacturers get a greater stake,” said the first official. “Nokia has an India-based office that employs many Indian engineers.”
Those doing over 50% value addition to products and networks by using equipment that is made in India and not just assembled in the country would be given preference, according to DoT. “Say Tech Mahindra gives a bid for 112 and Nokia for 100, Tech Mahindra will be asked to match the bid,” said former DoT technical advisor RK Bhatnagar. “Ericsson’s value addition, for example, would be around 25%, making them ineligible to be in preference category.”
Bhatnagar added that a version of the DoT’s proposal was discussed at a meeting convened by NITI Aayog, the government’s policy think tank, in early July.
“Private players such as Tech Mahindra made a presentation that they have the capability,” said Bhatnagar. “They had asked for a chance, and NITI Aayog had suggested the same to DoT.”
“The players can be asked to set up a consolidated network, which will then be tested over four months to see if it’s a workable solution and then can be replicated in other places,” he added.
