Nokia, Nortel win $862 m BSNL order

Shailendra Bhatnagar

NEW DELHI: State-run Bharat Sanchar Nigam Ltd. (BSNL), India's largest phone firm by sales, said it had placed GSM equipment orders worth about $862 million with Canada's Nortel Networks Inc. and Finland's Nokia.

BSNL's Rs 4000 crore contract for equipment based on the Global System for Mobile (GSM) communications platform is the largest so far in India's flourishing wireless industry -- the world's fastest growing major mobile market.

The equipment will help BSNL compete more aggressively with larger rivals -- Reliance Infocomm Ltd., the telecoms arm of the powerful Reliance group, and Bharti Tele-Ventures Ltd., 28 percent owned by Singapore Telecommunications Ltd.

"Final selection of the vendors has been done ... advance purchase orders have been placed for 7 million GSM lines with Nortel and 4 million lines with Nokia," N.K. Mangla, BSNL's director for marketing, said.

"This equipment should suffice to cater to our needs till December 2005 when our GSM-user base is expected to be about 25 million."

New Delhi-based BSNL, which has more than 6.23 million GSM-users and is ranked third based on the number of GSM customers, will install the gear in northern, eastern and southern parts of India.

It provides fixed line services and mobile facilities on the GSM and the rival CDMA platforms and Internet in all but the two main Indian markets of New Delhi and Bombay.

India's cut-throat wireless industry has more than 40 million users and the number is expected to climb to 100 million by 2005 as carriers roll out nationwide networks to tap into booming demand coming from an under-penetrated market.

Only four in a 100 Indians own a mobile handset compared with more than 21 in China and more than 60 in Europe.

Some of the cheapest mobile call rates -- less than one U.S. cent on average -- are luring between 1.3 to 1.6 million customers each month in the nascent sector, which has become a magnet for global equipment suppliers such as Ericsson and Motorola Inc.