The infrastructure revenues for FY 2001-02 stand at Rs 10,022.8 crore. This covers revenues of infrastructure equipment players in India, plus revenues of multinational players and other vendors who have not provided their figures for the fiscal. It also includes the service revenues of turnkey service providers operating in the infrastructure space. In the fiscal 2000-01, the infrastructure figure was around Rs 7,546.89 crore. So, the infrastructure segment has grown by 32.8 percent in the previous fiscal. We might see a similar or enhanced growth in the current fiscal, as a lot is happening at Tata Teleservices’ and Reliance’s ends on the basic and DLD service fronts. Also, some orders, which have been given in the fiscal 2001-02, will be billed in the current fiscal, as the projects will be completed this fiscal.

The infrastructure companies coming from the V&D 100 Club contribute around Rs 7,562.8 crore, which is about 75 percent of the total industry size. LGSYS had a whopping growth of 3,115 percent, resulting in an infrastructure revenue of Rs 976.3 crore. The company bagged good orders for WLL-rural as well as WLL-urban from BSNL. Multinationals did pretty well except for Lucent and Nortel which had a negative growth, as these companies did not perform well even in the international market. Even Cisco didn’t perform well as the ISP segment was down and IP didn’t took off. The company was unable to open its account in India on the transport front also.

In terms of new technology deployments, the country saw VoIP network being deployed by Data Access, the private ILD service provider in the country, which plans to start service in the country very soon. The order was bagged by VocalTec. Even VSNL is planning for the VoIP network where tenders have been floated and will be executed in the current fiscal.

Long Distance
In terms of cables deployed, the country witnessed a large-scale deployment of optical fiber cable in the country. Bharti Telesonic and Reliance, the domestic long distance (DLD) players in the country, have been deploying OFC in large quantities, and it seems that together the two of them would have imported cable worth Rs 648 crore. Bharti Telesonic deployed around 12,000 km of OFC, and Reliance deployed around 15,000 km of OFC. In the previous fiscal, Bharti Telesonic finalized Nortel as the SDH vendor and Alcatel for ATM switch. On the other hand, BSNL deployed 99,620 rkm of OFC against a target deployment of 126,000 rkm. The total cable deployed in India was worth Rs 4,783 crore. On the JFTC front, the service providers and the utility companies together deployed around 500 lckm.

Highlights 2001-02

The infrastructure companies coming from the V&D 100 Club contribute around Rs 7,562.8 crore, which is about 75 percent of the total industry size. LGSYS had a whopping growth of 3,115 percent, resulting in an infrastructure revenue of Rs 976.3 crore Bharti Telesonic deployed around 12,000 km of OFC, and Reliance deployed around 15,000 km of OFC.  On the other hand, BSNL deployed 99,620 rkm of OFC against a target deployment of 126,000 rkm. The total cable deployed in India was worth Rs 4,783 crore.  In terms of the number of the total switching capacity, the two incumbent operators (MTNL and BSNL) together added 7.3 million lines, and added 5.7 million DEL lines. Private operators added 0.28 million lines in the fiscal 2001-02. BSNL executed a switching order worth Rs 190 crore through Lucent. On the switching front, Alcatel bagged a 65-million euro contract for more than 1 million switching lines from BSNL, which is planned to be completed by September 2002. BSNL executed a switching order worth Rs 190 crore through Lucent. On the switching front, Alcatel bagged a 65-million euro contract for more than 1 million switching lines from BSNL, which is planned to be completed by September 2002. Tata Teleservices awarded a broadband contract, worth Rs 100 crore, to Lucent. In terms of new technology deployments, the country saw VoIP network being deployed by Data Access

On the optical transmission front, BSNL awarded contract worth Rs 175 crore. In the beginning of the current fiscal, BSNL awarded a DWDM contract worth Rs 260 crore to Huawei and ZTE.

On the utilities front, Power Grid Corporation awarded a transmission contract to Tellabs, worth Rs 40 crore. GAIL too has been an early mover on the infrastructure front. For the first phase which is complete, the company is deploying a nationwide backbone network using DWDM and SDH. The optical network spans more than 2,000 km and carries voice and data across seven states—Delhi, Uttar Pradesh, Rajasthan, Gujarat, Haryana, Maharashtra, and Madhya Pradesh. GAIL awarded the first phase of the project, worth Rs 30 crore, to Nortel, and the second phase of the project is estimated to be in the range of Rs 25-30 crore. Railtel, the infrastructure wing of Indian Railways, is presently evaluating and is planning to come out with an order for STM-1 to STM-4 links. Bharti Telesonic’s order for SDH to Nortel is an ongoing one—it was worth Rs 30 crore in the fiscal 2001-02.

Reliance has also finalized a DWDM order recently, and a majority of the order has gone to Nortel.

Basic Services
On the basic services front, there has been a keen tussle between wireless and wireline, and in a couple of years, there will be more additions in the wireless space than in the wireline space. In terms of the number of the total switching capacity, the two incumbent operators (MTNL and BSNL) together added 7.3 million lines, and added 5.7 million DEL lines. Private operators added 0.28 million lines in the fiscal 2001-02. Bharti took the lead in basic services and launched operations in all the four circles of Delhi, Haryana, Karnataka, and Tamil Nadu. Reliance and Tata are planning to launch their services by the end of the second quarter or the beginning of the third quarter.

BSNL executed a switching order worth Rs 190 crore through Lucent. On the switching front, Alcatel bagged a 65-million euro contract for more than 1 million switching lines from BSNL, which is planned to be completed by September 2002.

On the CDMA front, BSNL awarded WLL (rural) order of 500,000 lines, worth Rs 1,500 crore, to Lucent, Hyundai, and LG. The project was a complete turnkey project where infrastructure and terminals were supplied. In the current fiscal, the company has floated another tender for 500,000 WLL (urban). BSNL is also planning to float WLL (M) tender for 17 lakh lines (which is under evaluation). The incumbent operators MTNL and BSNL have also gone for a CorDECT order worth Rs 54 crore.

On the private front, Bharti expanded its operations from Madhya Pradesh to Delhi, Haryana, Karnataka, and Tamil Nadu. In this case, the switch order was awarded to Siemens, SDH order for Karnataka and Tamil Nadu to Siemens, and SDH order for Delhi and Haryana to Alcatel. For the MP circle, the company invested around Rs 33 crore for infrastructure.

During the previous fiscal, MTNL launched WLL (both fixed and mobile) in the cities of Delhi and Mumbai, with capacities of 50,000 lines each. Motorola executed the Delhi order, whereas Fujitsu implemented the Mumbai order.

Hughes Tele.com gave a contract to Lucent for broadband infrastructure deployment, for services like ADSL and ISP operations worth Rs 100 crore. Tata Teleservices awarded a broadband contract, worth Rs 100 crore, to Lucent.

In the current fiscal, Tata Teleservices awarded wireline and wireless orders. Wireline order was awarded to Alcatel and Lucent. Alcatel bagged the order for the circles of Delhi and Tamil Nadu, to offer narrowband and broadband services. The order is worth $12 million. Lucent bagged the wireline order for Karnataka and Gujarat. The transmission order was bagged by Marconi whereas microwave order was bagged by Digital Microwave.

Reliance, which has a very ambitious plan of deploying 5 million lines, has finalized on Ericsson as its switch vendor, but talks are still on for wireless infrastructure.

Cellular Services
The cellular base in the country increased from 3.57 million in March 2001 to 6.43 million in March 2002, an increase of around 80 percent. MTNL had a high jump of around 1,000 percent, taking the overall tally to 182,304 subscribers. Companies have been going for GPRS-ready network and deploying IN networks.

In the cellular space, BSNL awarded a large contract to Lucent, Ericsson, and Motorola, for 4 million lines in 1,000 cities. In the first phase, the company is planning to deploy 1.4 million lines, while in the second phase plans are to deploy 2.6 million lines. The company is also planning to spend around Rs 2,000 crore for the cellular project. Motorola bagged the order for south, Ericsson for north and east, and Lucent for west.

Bharti awarded the complete GSM infrastructure order for five new circles of Haryana, Kerala, MP, Tamil Nadu, and UP(W). For the western India, Bharti awarded the GSM network order (including GPRS), worth $70 million, in the circles of Mumbai, Maharashtra, and Gujarat, to Motorola. In this case, Siemens is going to supply radio networks.

MTNL placed a cellular order, worth Rs 100 crore, for Delhi and Mumbai. Hutch awarded the complete cellular infrastructure order, worth Rs 235 crore, to Ericsson for the new circles of AP, Chennai, and Karnataka.

There was a lot of expansion on the wireless front. Escotel awarded a $35-million contract to Lucent Technologies, for expansion and upgradation of the network in UP(W), Haryana, and Kerala. Idea Cellular created a microwave network covering 700 odd km connecting Hyderabad to Vishakhapatnam. BPL Mobile went for an expansion order in Mumbai, Maharashtra, and Goa.

Forecast
In the fiscal 2001-02, the infrastructure segment will see a good growth, as Reliance is planning to spend a huge amount of money on infrastructure for DLD and CDMA-based WLL (M) services in the country. The total capex is expected to be in the range of more than $1 billion. Even Tata Teleservices, the second largest basic service provider in the country, is planning to expand in four more circles, and the infrastructure order will be executed in the current fiscal. The company is planning to invest around Rs 10,000 crore, of which Rs 8,000 crore is for basic services and the remaining is for long distance. VSNL has taken the lead from Tata to implement the long distance project and has already started working on it. Bharti is also planning to lay another 14,000 odd km of OFC and take the long distance network to all the major cities. It is also expected that BSNL will come out with a large order on WLL (M).

In terms of technology, CDMA will see a lot of investment in the fiscal 2001-02. On the GSM front, the second phase of 2.4 million lines will be deployed by BSNL in the coming fiscal. DWDM and SDH will also contribute a sizable amount to the infrastructure kitty, as many DLD projects will be expanded or launched in the country. In the fiscal 2002-03, BSNL and private operators will add a sizable amount of wireline switches. There will also be a major investment on the VPT front by both the incumbents and private operators. All this will help in boosting the infrastructure revenue in the years to come.

Pravin Prashant