Telecom Commission, in its meeting on September 9, approved plans to install an additional four million telephone lines, exchanges, optical fibre cable (OFC) and village public telephones (VPTs) as part of the objective of providing telephone on demand in three years.

DoT and Mahanagar Telephone Nigam Ltd (MTNL) together will now install more than 22.6 million telephone lines, as against the original proposal of 18.5 million lines by 2002.

Out of this, DoT will install 20.7 million lines, as against the earlier target of 16 million. MTNL's target of 2.5 million lines remains unchanged as it already provides telephones on demand in Delhi and Mumbai.

In an internal assessment by TC, it has been estimated that the total number of telephone lines may even cross the 23million-mark by the year 2002.

DoT proposes to organise the required capital through internal resources as well as external borrowing in three years from 1999-2002 for funding the expansion.

However, the extent of borrowing is yet to be finalised as it would depend on the internal revenues which are expected to take a hit due to the recent changes in call tariffs and the proposed opening up of STD services to private sector.

In addition, increased outflow of funds on account of DoT/MTNL having to pass on 66 per cent of the cost of a call from its network to private cellular service providers and the proposed corporatisation of DoT will also have a bearing on resource generation. The department is facing a tough time and may end the financial year with an estimated revenue shortfall of Rs 2000 crore.

One factor working in favour of DoT is the declining cost of materials, due to which there is no increase in the original capital outlay as envisaged in the Ninth Plan.

DoT has also taken note of thefailure of the private sector in meeting the village public telephone (VPT) targets as per the original licence agreements. As such, it has decided to install a further 40,000 VPTs, in order to hook up all the villages to the telecom network by 2002. DoT will now install nearly 2.8 lakh VPTs, as against the earlier proposed 2.40 lakh.

In the event of private operators again failing to meet their commitment of connecting nearly 70,000 villages, DoT will take up the balance villages also.

The increase of four million telephone lines has also necessitated a proportionate increase in the long distance switching capacity by 3.63 lakh lines. Now DoT will commission 21.63 lakh lines of long distance switching (TAX) capacity as against the earlier plan to install 18 lakh lines.

In another move to provide reliable communication media and sufficient bandwidth for the burgeoning internet and information technology sector in the country, DoT has decided to install an additional 1.3 lakh route km (Rkm) of opticalfibre cable (OFC) in the next 30 months.

The target has been increased from 1.4 lakh Rkm to 2.7 Rkm. DoT has also decided to scale down plans to install microwave in order to conserve scarce frequency bands and also to promote the usage of the more reliable and cheaper OFC.