Videsh Sanchar Nigam (VSNL) will review its plans of roping in a private telecom player for its proposed national long distance (NLD) foray. This follows the divestment of the government's 25 per cent stake in the international telephone carrier to the Tatas.
"As we have decided to put our plans to lease optic fibre capacity (OFC) from a leading telecom player on ice due to the strategic sale, the new management will take a relook at its earlier plans. We had zeroed in on Reliance Infocom for the venture," VSNL executives said, adding that VSNL had, however, not signed any agreement with telecom companies on this.
"Since the Tata group has become a strategic partner, the new management will take a final decision on the NLD alliance. Prior to the recent board revamp, the management had taken a decision not to go ahead with the alliance. If the Tatas want to join hands with anybody, let them take the decision," the executives said.
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VSNL has been looking at leasing an OFC network from a telecom player to connect main cities and had invited bids last fiscal.
Reliance had sought to lease its optic fibre cable backbone to run the NLD services of VSNL.
Along with Reliance Infocom, the Tatas, Bharti Tele-Ventures, Powergrid and other leading companies had shown an interest in offering their OFC network to VSNL.
VSNL, which will lose its monopoly in the international long distance business from April, has already inked a licence agreement with the Department of Telecommunications for NLD. It is planning to invest around Rs 2,000 crore in the venture over 3-5 years.
Reliance, one of the contenders in the race, has major plans for the NLD service segment. It has already laid a duct of 18,000 kms, of which 7,000 kms is already "blown" with optical fibre.
Bharti Tele-Ventures is the only other major telecom company which has announced plans to foray into NLD services.