The government is considering winding up the Bharat Broadband Network (BBNL), which was set up nearly a decade ago as a special purpose company to connect every gramme panchayats with high-speed optic fibre, and allocating its job to state-owned telecom provider BSNL, according to sources.
Bharat Broadband Network Limited is a Special Purpose Vehicle set up under the Companies Act by the Government of India with an authorized capital of Rs. 1000 Cr. It has been mandated to create the National Optical Fiber Network (NOFN) in India.
A total of around 2,50,000 Gram Panchayats spread over 6,600 Blocks and 641 Districts are to be covered by laying incremental fibre. The timeline for this ambitious project is two years. The project cost is estimated to be about 20,000 Cr which will be funded by the USO fund.
The BharatNet project is being implemented by BBNL, which has received close to Rs 24,000 crore from the Universal Service Obligation Fund thus far. So far, 1.71 lakh gramme panchayats have been linked out of a total of 2.5 lakh gramme panchayats in the country.
The scope of the BharatNet project was further extended in July last year when it was decided that all six lakh villages in the country would be connected with optic fibre, for which the government would provide Rs 19,041 crore as viability gap funding. With this, the total outlay for the BharatNet project increased to Rs 61,109 crore, which includes the Rs 42,068 crore approved in 2017.
According to sources, the idea to wind up BBNL and assign its functions to BSNL was mooted a couple of months ago, and four to five meetings have taken place to finalise the modalities around it.
BBNL’s work of laying optic fibre can be done by BSNL, but issues relating to fair play may come up since BSNL is a telecom operator which competes with private telecom players.
Earlier, BBNL had curtailed the scope of BSNL in maintaining the BharatNet project. BSNL used to get around Rs 400 crore per year to maintain the BharatNet fibre, but as it failed to provide quality services, BBNL did not extend the contract and awarded it to CSC SPV.
BSNL’s participation in phase II of BharatNet was also curtailed by over 50%. One of the reasons was a change in strategy of implementation as state agencies are being involved, which was not the case in the first phase. Phase 1 of the project, which connected one lakh gram panchayats, was implemented by three central public sector units — BSNL, RailTel and PGCIL — with most of the work done by BSNL.