Government may merge
broadband, e-services delivery projects into a jumbo Rs 60,000-crore project
KOLKATA: The Narendra
Modi-led government could merge two key broadband ventures into a jumbo Rs
60,000-crore project to speed up delivery of high-speed internet and government
services to the common man under the ambitious Digital India drive. It is
weighing the pros and cons of mandating Bharat Broadband Networks (BBNL) to
implement the national broadband and government-to-citizen e-services projects
as a single venture on a turnkey basis, a top telecom department official told
ET.
Telecom minister Ravi
Shankar Prasad is learnt to have sought the views of DoT and its rural network
infrastructure financing arm, the Universal Services Obligation Fund (USOF), on
a potential roadmap, including cost structures, of mandating BBNL to build both
the national optic fibre network, and also leverage it to deliver e-services
across rural India."The minister wanted to get DoT's views on whether BBNL has the requisite managerial depth and manpower resources to implement both projects to meet broadband targets in the backdrop of Digital India goals," a top government official present in a recent meeting chaired by Prasad told ET.
Bharat Broadband
Networks chairman & managing director and USOF Administrator Aruna
Sundararajan could not immediately be reached for comment.
At present, BBNL has a
national long distance operator (NLDO) permit and will be the prime wholesale
bandwidth supplier for the national broadband project. It remains to be seen
whether the government will broaden BBNL's role, by also arming it with a
suitable permit to provide broadband services down to the retail consumer level
in the rural hinterlands.
The Rs 20,100 crore national broadband network will serve as a countrywide optic-fibre pipe to provide high-speed internet connectivity across rural India while the Rs 30,000-crore-plus wifi-based e-services project aims to create a commercial ecosystem to recover the costs of building such rural broadband infrastructure. Since the national broadband project is likely to see a 40% cost-escalation to nearly Rs 28,000 crore, the combined capex and opex cost of executing both projects is internally envisaged at roughly Rs 60,000 crore by DoT.
The Rs 20,100 crore national broadband network will serve as a countrywide optic-fibre pipe to provide high-speed internet connectivity across rural India while the Rs 30,000-crore-plus wifi-based e-services project aims to create a commercial ecosystem to recover the costs of building such rural broadband infrastructure. Since the national broadband project is likely to see a 40% cost-escalation to nearly Rs 28,000 crore, the combined capex and opex cost of executing both projects is internally envisaged at roughly Rs 60,000 crore by DoT.
"Currently,
BBNL's role is purely B2B (business to business), in that, it will be a
bandwidth supplier to telcos who will eventually ride on the national broadband
network to deliver services. But if BBNL is also required to deliver broadband
services, its business model will have to migrate to the business-to-consumer
(B2C) format," said another DoT official aware of the matter.
The DoT is taking a
relook at these two broadband projects as it is under intense pressure from the
Prime Minister's Office (PMO) to speed up inter-related central ventures billed
to provide broadband infrastructure and the accompanying ecosystem for
delivering citizen services under the Digital India initiative. More so, since
the national broadband venture is running way behind schedule and the
government is looking to involve the private sector to speed it up.
Global companies such
as Facebook, Microsoft, Hewlett Packard and Google have already evinced an
interest to partner with the government in various capacities in the national
broadband venture, especially for last mile connectivity to the rural consumer.
However, DoT believes a key challenge in involving a single telecom agency for both broadband projects is potentially re-defining the role of the rural development ministry, which was mandated by the previous UPA government to handle the opex costs of the e-services venture. The rural development ministry has agreed to meet the Rs 25,000 crore opex cost over a 10-year span.
However, DoT believes a key challenge in involving a single telecom agency for both broadband projects is potentially re-defining the role of the rural development ministry, which was mandated by the previous UPA government to handle the opex costs of the e-services venture. The rural development ministry has agreed to meet the Rs 25,000 crore opex cost over a 10-year span.
"Plans to involve
a single telecom agency could have sensitivities since the rural development
ministry will handle bulk of the costs of the e-services project, where DoT's
funding exposure through USOF will be restricted to only the Rs 5,000 crore
capex component," said one of the officials quoted above.
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