BSNL seeks ZTE help to revive Kolkata unit

Chinese telecom equipment manufacturer ZTE and state-owned Bharat Sanchar Nigam Ltd are in talks to revive the PSU's manufacturing base in Kolkata.

But issues such as transfer of technology and machinery, and the status and equity ratio between the two in the joint venture remain to be resolved before the deal can be signed, sources close to the development said.

According to the sources, BSNL has set up a committee to work out the modalities of the joint venture.

To begin with, the joint venture will include manufacture of a million CDMA-based mobile handsets and an equal number of fixed wireless telephones.

"Talks are on between the companies. BSNL is looking at a deal similar to the one between ITI and French telecom major Alcatel, which involves joint manufacturing and transfer of technology," the sources said.

On the status and equity ratio of the joint venture, BSNL executives said the PSU was in favour of a 50:50 venture. When contacted, ZTE confirmed that it was in talks with BSNL, but refused to elaborate.

If successful, this will be BSNL's first ever joint venture with an international telecom major.

The PSU wants to retain the option of entering into similar tie-ups with international telecom majors for its other factories.

Currently, BSNL has seven manufacturing units located in Mumbai, Kolkata, Gopalpur, Jabalpur, Bhilai and Kharagpur. ZTE's main competitor in China, Huawei Technologies, has also expressed interest in entering into a similar deal with BSNL.

BSNL had earlier shortlisted both ZTE and Huawei Technologies for manufacturing two million telephone handsets at the Kolkata factory, but had chosen the former after evaluating the expressions of interest submitted by both the companies.