DTO to start cellular services in Jan 2001; to float a tender

NEW DELHI, AUG 24: Department of Telecom Operations (DTO) will start cellular services in the country by January 2001 and a tender for pro...

NEW DELHI, AUG 24: Department of Telecom Operations (DTO) will start cellular services in the country by January 2001 and a tender for procuring equipment for installing over 12 lakh lines will be floated by the end of this month.

The Telecom Commission, which met here recently, decided to float the tender for procuring equipment costing about Rs 500 crore, official sources said.

The department had authorised C-DoT to implement pilot project in states of Andhra Pradesh, Tamil Nadu, Bihar and West Bengal on turnkey basis, sources said adding that since the pilot project was quite successful, it’s was time to start full-scale cellular operations in the country.

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According to sources, the decision has been taken based on the report submitted by all the chief general managers of circles where the pilot project was launched in which they have advocated the start of this service in the competitive scenario and forwarded the demand projections of about 12.78 lakh lines for the year 2000-01.

As per the schedule the entire process of floating tender and processing would be completed within three months and early next year equipment were likely to be procured by the department, sources added.

The total estimated cost of procuring 12.78 lakh lines of cellular operations’ equipment would be about Rs 498 crore as per the project cost details submitted by the department. However, the actual cost would be known only after opening of tender.

The cost per line of providing cellular connections has been worked at about Rs 2,738 excluding the cost of the handset.

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Mahanagar Telephone Nigam Ltd (MTNL) which had recently floated the tender for starting cellular services in Delhi and Mumbai had worked out the cost at Rs 3,974 per line without the handset.

As per the estimates given in the project report, the department’s revenue is projected at Rs 1,415 crore as per the tariff given by the Telecom Regulatory Authority of India (TRAI) against an expenditure of about Rs 717 crore thereby giving annual profit of about Rs 698 crore.

While calculating the expenditure for the proposed service, the licence fee to be paid to government and sharing of revenue have been taken into account, sources said.

However, the actual cost and profits of the department would be known only after opening of tender and start of the services, they added.