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RIL Info, Nepal Tele in deal

Nepal Telecom Ltd and India's Reliance Infocomm signed on Thursday a preliminary agreement to share fixed-line networks.

india Updated: Mar 31, 2006 12:50 IST

Nepal Telecom Ltd and India's Reliance Infocomm signed on Thursday a preliminary agreement to share fixed-line networks, a senior official of the state-owned Nepal telecoms provider said.

Nepal relies on satellite links for global connectivity now, but would prefer to get it through access to Reliance's under-sea cable line operator FLAG Telecom, Nepal Telecom Managing Director Sugat Kansakar said.

"We will be linked from the India border to Mumbai where we will use Reliance's FLAG Telecom network," said Kansakar, who was in Mumbai to sign the preliminary agreement.

Work on the project is expected to start in the next few months.

An optical fibre cable link would be built from Jogbani in Bihar to Kathmandu, another source close to the deal said.

The alliance aims to meet future demand for voice, data and video traffic between the two countries, and it could eventually prove to be an important link between India and China for Reliance, the source said.

Reliance Infocomm, which is part of Reliance Communications Ventures Ltd, had struck a connectivity deal with China Telecom in December.

Nepal Telecom is already building a network from Kathmandu to the China border, which will be completed in about a year, and talks are on with Reliance Infocomm and China Telecom to lay an optic fibre cable network into China, Kansakar said.

"We are in the preliminary stages of discussion with China Telecom on this," he said, adding that an agreement was expected in the next two months.

"Through China we expect to go to Russia and other places."

Nepal opened its first telecoms "superhighway" in January to improve line quality and increase phone usage in the rugged, mountainous nation, where only about 3 in 100 people have one.

Apart from its fixed-line assets, Reliance Infocomm has a mobile subscriber base of more than 17 million.

Prior to the news, shares of Reliance Communications ended 0.9 per cent higher at Rs 302.70 in a firm Mumbai market.

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