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MTNL to open cellular tenders on July 1

Despite a Delhi high court case pending against the Mahanagar Telephone Nigam, stopping it from going ahead with its cellular telephony plans, several international companies are all set to supply MTNL equipment for the project.

Motorola, Nokia, Siemens and Ericsson are among those who have shown interest in setting up MTNL's proposed mobile telephone network in Delhi and Bombay.

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MTNL Chairman and Managing Director S Rajagopalan has said that "The tenders for our cellular network equipment, estimated to cost about $1 billion, would be opened on July 1 and offers would be made on the basis of turnkey projects."

Regarding the Department of Telecom's petition in the Delhi high court, challenging the decision of the Telecom Regulatory Authority of India to restrain MTNL from entering cellular phone operations, Rajagopalan said "Though the matter is subjudice, I am confident we will get justice and MTNL will be able to launch cellular services very soon."

The bidders are supposed to design the entire network and complete the job within four to six months, Rajagopalan explained.

The legal complexities have delayed the launch of the services despite MTNL's assurance to investors at the time of its global depository receipt issue last year that it would start cellular operations in early 1998.

The turnkey project means that the final vendor will have to design the entire network and the work would include survey, designing, supply and installation, commissioning test and finally makeover.

The Delhi and Bombay circles could have different or the same suppliers. It depends on the nature of the bidding, Rajagopalan explained. He is expecting "attractive bids".

Envisaging about one million cellular customers each in Delhi and Bombay circles in the next five years, the equipment will cost the telecom public sector unit at least Rs 40 billion.

The cost has been quite high even at a very conservative estimate of cost of about Rs 20,000 per subscriber.

In the initial years the cellular networks are expected to cost $150 million each, while it is estimated that the total market demand for cellular services in Delhi and Bombay will be over Rs 26 billion annually by 2001.

- Compiled from the Indian media

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