Reliance Infocomm to sign deal with China Telecom

MUMBAI: India's largest CDMA mobile services provider, Reliance Infocomm, is close to signing a connectivity deal with top mainland fixed-line carrier China Telecom, a spokeswoman said on Tuesday.

"We are close to finalising a deal," the Infocomm spokeswoman said, declining to disclose details.

A newspaper reported on Tuesday that the deal would be for direct connectivity between the two countries. Calls from India to China are now routed via the United States or Europe.

Reliance Infocomm would route calls using the extra bandwidth that it has in its FLAG Telecom unit, which operates under-sea cable lines, the Times of India said, meaning call tariffs to China would fall by about 55 percent to 8 rupees per minute.

"Due to this drop in tariff, Reliance Infocomm expects volume of calls to China would increase by 300-400 percent," it added.

India is the world's fastest-growing major mobile market, with 68 million users and nearly 3 million new users signing up every month.

Reliance Infocomm is India's second-largest privately owned mobile phone operator, with more than 13 million customers, mostly operating on CDMA technology.

Indian media reports had said in September that China Mobile (Hong Kong) had offered to buy Reliance Telecom Ltd., a small mobile services operator using the rival GSM technology.

Recent media reports have said China Telecom aims to introduce international strategic investors to improve its management expertise and corporate governance. Reports have speculated that these may include NTT DoCoMo, France Telecom or Verizon Communications.

(Additional reporting by Shailendra Bhatnagar in NEW DELHI)