India's BSNL cans €7.5b GSM tender

Nicole McCormick | March 08, 2010

telecomasia.net

Thumbnail:

BSNL’s board on Friday agreed to cancel the Indian mobile operator’s $10 billion (€7.32 billion) GSM expansion tender, after 22 months of debate.

The scrapping of the tender follows a decision by a high-level government committee recommending that it be called off, the Economic Times said.

Prime Minister Manmohan Singh set up an inquiry into BSNL’s botched GSM expansion tender in January. It was chaired by Singh’s adviser on telecom and innovation, Sam Pitroda.

The Prime Minister said the committee would have the final government say on whether the tender would proceed or not.

The state-owned carrier’s 93-million line tender has been shrouded in controversy since its launch in May 2008.

BSNL's board put the tender on ice in late January, pending a review into alleged irregularities by the Central Vigilance Committee (CVC), which examined why BSNL renegotiated on price with Ericsson.

Ericsson was to deploy 25 million lines in the north zone and 18 million lines in the east zone, worth a combined $2.5 billion, according to ET.

Earlier, Chinese vendor Huawei was reportedly dropped from the tender – it topped the short list to supply 25-million lines in the South Zone for $1 billion – because of security concerns.

Last month, the CVC also recommended that the tender be cancelled.

For BSNL, which is struggling to keep pace with fast-moving privately-owned competitors, the news is disastrous. The cellco exhausted capacity in most of its 20 circles almost 18 months ago, said ET.

Source:

Nicole McCormick