Make in India: DoT may ask BSNL to try local end-to-end networks for 4G upgrade
The decision can have far-reaching ramifications as the new setup, if found feasible, can be replicated for other network providers and to upgrade to 5G services
The Department of Telecommunications (DoT) is mulling advising BSNL and MTNL to test out locally consolidated networks for a few months before they take a call on who to select to upgrade their 4G spectrum services, Hindustan Times has learnt.
The decision can have far-reaching ramifications as the new setup, if found feasible, can be replicated for other network providers and to upgrade to 5G services, the tender process for which is yet to begin.
HT has earlier reported that the DoT had set up a six-member panel to look into the 4G upgrade tender after it was scrapped on July 1. The decision had come in the wake of 20 Indian soldiers being killed in the Galwan Valley by China. The decision was also taken in keeping with the preference to Make in India policy of the telecom department, and a bid to reduce reliance on Chinese companies such as Huawei and ZTE.
The six-member panel, which has representatives from DoT, BSNL, MTNL and the industry, has already met five times and is in the final stage of outlining requirements for the fresh tender. The final tender requirements are likely to be concretised by the end of the week. The ₹7,000-8,000 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 turn-key setup in place,” said a DoT official who did not wish to be named. “A turn-key setup offers end-to-end network, including both radio and core requirements that are consolidated at a central level by a single operator.”
According to the official, tech giants such as Nokia and Airtel have their own turn-key setups in India. The official that while seven companies manufacture radio equipment, used to set up 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 likely incorporate multiple vendors to setup an end-to-end network.”
A member of the panel, on the condition of anonymity, told HT that reservations had been expressed about the ability of Indian tech companies to set up the network.
“We are discussing telling BSNL and MTNL 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 appropriate results.”
According to experts, nearly 75% of the telecom equipment is sourced from companies outside India, especially the internal components. Two major Chinese firms with a stake in the Indian market are ZTE and Huawei, both Chinese companies. Other major players include Nokia, Ericsson and Samsung.
“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.”
At present, according to the preference to make in India policy of the DoT, those doing over 50% addition to product and network by using equipment made in India and not just assembled here given preference.
“If 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. “Ercisson’s value addition, for example, would be around 25%, making them eligible to be in preference category.”
Bhatnagar added that a version of the DoT’s proposal was discussed at a meeting convened by NITI Aayog in early July.
“Private players such as Tech Mahindra made a presentation that they have the capability,” said Bhatnagar. “They had asked for an opportunity, 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 4 months to see if it’s a workable solution and then can be replicated in other places,” he added.