The Ministry of Finance has rejected the Department of Telecommunication’s proposal to appoint Bharat Sanchar Nigam Limited as the agency for executing the national optical fibre broadband project. The Ministry of Finance has said that a special purpose vehicle (SPV), comprising both private and state-owned operators should be given the responsibility of executing the Rs 200 billion project. Prior to this, DoT had suggested creating an SPV to manage the fibre network after the project is completed. However, the Ministry of Finance has said that the entity should be created at the first stage itself. It added that the government should hold a majority share in the SPV.
The Ministry’s view is in line with the recommendations of the Telecom Regulatory Authority of India. The regulator had expressed concern over giving the mandate to BSNL in a competitive market.
Also, a committee headed by Sam Pitroda, Advisor to the Prime Minister, had suggested setting up an SPV comprising various central public sector undertakings, who already own optical fibre cable. The proposal included BSNL, RailTel and Power Grid Corporation as part of the SPV.
However, DoT had said that BSNL was best positioned to execute the project, as it already owns 0.625 million route kilometer of optical fibre cable, out of a total of 1.1 million route kilometer optic fibre cable laid in the country by all operators. The Ministry of Finance has suggested that BSNL?s assistance be taken for carrying out a detailed project report, before rolling out the network aimed at connecting 0.25 million village panchayats.
Further, the Ministry of Finance has also told DoT that it cannot seek any monetary assistance for the project from the exchequer.
