BSNL floats tender for 45.5 mn lines

Order worth between $2.5 bn and $4 bn is the world's largest mobile tender.

Bharat Sanchar Nigam Ltd today issued the world's single largest GSM mobile tender for a total of 45.5 million lines, combining the existing 2G technology with the third generation mobile platform.

Going by current estimated equipment prices, this order can be worth anywhere between $2.5 billion and $4 billion. But one single company will not get the entire order.

The list of prospective bidders includes most global telecom equipment companies, including Nokia Networks, Ericsson, Siemens, Nortel, Motorola, Lucent and Alcatel.

As expected, BSNL has set a number of stiff conditions and safety clauses in the tender.

Under the two-stage bidding slated to open on April 28, successful vendors will have to achieve a minimum of 30 per cent value addition on indigenously manufactured core equipment.

To ensure that this is done, a bidder will also have to submit a 5 per cent manufacturing bank guarantee along with other standard guarantees.

The equipment will have to be 3G mobile technology-enabled. The tender stipulates that bidders must provide an undertaking that network elements support both 2G and 3G technologies for the next seven years with a product portfolio and road map for implementation on the entire network. Companies must have a minimum turnover of over $1.8 billion each for the last two years to be eligible to bid.

At the time of opening of the tender, bidders must possess experience of supplying and rolling out GSM networks in not less than 10 countries, the conditions add.

The tender also states that successful vendors must establish software centres in India for providing necessary support during the lifetime of the equipment, while adding that remote access from a facility outside India shall not be generally allowed. Besides, after deployment, bidders will have to undertake annual maintenance contracts in perpetuity.

Supplies against the purchase order for the first lot, not exceeding 17.5 million lines, can be imported as completely built units, or in semi knock-down or completely knocked-down condition. Supplies for the balance 28 million lines shall be made only after manufacturing has been started by the bidder company.

Bidders must also possess experience in planning, engineering, supply, installation and commissioning of at least 20 million lines of GSM 900, GSM 1800 network equipment. Bidders or their collaborators should have at least two 3GPP release 4 or higher version UMTS core network of a capacity of 5 million subscribers in two countries.

These networks should have been commercially operational for at least six months on the date of opening of bids.

A bidder and the contract manufacturer must have filed an industrial entrepreneur memorandum with the department of industrial policy and promotions before submission of the bid.

They will also have to complete many steps for manufacture of core equipment in India within a period of six months from the date of issue of purchase order.

These include ensuring construction, leasing of factory premises and placing firm orders for procurement of capital goods.