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Vivek Law
Mumbai, Apr 18: Videsh Sanchar Nigam Ltd (VSNL) is close to sewing up two 50:50 joint ventures with global telecom powerhouse British Telecom, one for marketing and providing hubbing facilities for the region and the second for creating an Internet backbone for the country.
The marketing venture is being forged as an alternative to the ambitious $500-million project for setting up a full-fledged hub in the country. This project, which has virtually been stalled by the Government, was to have been forged in an alliance with either British Telecom or MCI-Worldcom.
VSNL sources said till the Government takes a view on the hub project, the telecom major has decided to start off with marketing the hubbing activity. The alliance would for a start only be marketing services to countries like Bangladesh, Sri Lanka and, possibly, Myanmar.
"Calls could then be routed through India to the neighbouring countries through VSNL rather than directly. This route would be cheaper for the international carrier. At thesame time, the focus would be on enhancing the volume of calls made to and from the UK. At present, the number of calls made from the country is fairly low and there is tremendous scope for growth in volumes to bring in greater revenue. The ultimate goal would be to set up a full-fledged regional hub but this can happen only after the Government allows it," said a VSNL source. "Since the earlier venture is still in limbo, we are planning to start with a marketing alliance. Negotiations with BT are at an advanced stage. We hope to finalise things in a couple of months," the source said.
However, what could be a far more high-profile venture is the setting up of a high-quality Internet backbone in the country. "The present capacity of our backbone is about 1.5 million users which will get exhausted shortly as the pace of expansion in Internet connections speeds up. What would also increase is the flow of Internet traffic within the country and this would require the presence of a high-quality backbone. Thiswould be a big project involving the setting up of optic fibre cables across the country with huge investments. We are in talks with BT for setting up such a backbone to take care of the future Internet needs of the country," said the source.
British Telecom, the fourth largest telecom player in the world, has been keen to make large investments in the country. It had been very enthusiastic on the hub project. It recently forged an alliance with the Bharti group for providing Internet services in the country.
Recently, BT officials had said that governmental dithering and the uncertain investment climate had forced it to keep away fresh inflows. The new policy announced by the Government seems to have had a positive impact on BT's views. Sandra Yiap, marketing manager for BT Asia-Pacific, said recently that the Government's initiatives on the telecom front had made BT more optimistic about investing in the country.
However, if the fall of the Vajpayee government sets off another review of the nationaltelecom policy, it will be back to square one.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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