BSNL 5G being fast-tracked, Make-in-India stance being re-looked

India is considering a significant shift in its approach to upgrading Bharat Sanchar Nigam Limited (BSNL) to 5G by allowing foreign vendors to bid for a portion of the Rs 17000 crore telecom gear contract. This marks a departure from the previous stance of relying solely on indigenous technology for BSNL’s network upgrades, including 4G and 5G services.

Until now, the Indian government has emphasized using domestically produced equipment for BSNL’s network upgrades. This included a recent 5G tender in Delhi that required bidders to use only indigenous equipment, which led to criticism from international vendors like Ericsson and Nokia.

The government is now mulling a proposal to reserve 50% of BSNL’s 5G tender volume for domestic suppliers while opening the remaining 50% to bids from all vendors, including global suppliers. This change is driven by the need to accelerate BSNL’s 5G rollout and enhance its market competitiveness.

Implications
Accelerated Rollout: Allowing foreign vendors could lead to a faster rollout of a world-class, pan-India 5G network for BSNL. This is because global vendors like Ericsson, Nokia, and Samsung have extensive experience and advanced technology that could improve network quality and performance.

Competition and Innovation: Foreign vendors’ participation is expected to increase competition, prompting local network vendors to accelerate their product development cycles. This could benefit BSNL by providing access to more advanced and competitive technologies.

Current BSNL 5G Plans: BSNL plans to launch 5G Standalone (SA) services in Delhi, targeting 1,876 sites across the 900 MHz and 3.3 GHz bands. The rollout includes a revenue-sharing model with bidders, where BSNL will manage marketing and sales while vendors deploy the network.

Challenges and Future Directions
Despite the potential benefits, there are challenges related to the financial burden on bidders, as they must cover both capital and operational expenses for deploying the 5G infrastructure. This has limited participation in the tender process.

Future Directions: The final decision on allowing foreign vendors is pending, but if implemented, it could significantly impact BSNL’s ability to compete with private telecom operators like Reliance Jio, Bharti Airtel, and Vodafone Idea, which already use equipment from global vendors.

CT Bureau