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In a bid to speed up the implementation of the national optical fibre project, the Telecom Regulatory Authority of India (TRAI) has recommended public-private partnership (PPP) model. This is contrary to the proposals made by an expert committee last year, which had suggested a model wherein the Central public sector units in some States and the private sector be roped in under engineering, procurement and construction (EPC) contracts.
TRAI said that a PPP model works better than EPC model. “A PPP model that aligns private incentives with long-term service delivery in the vein of the Build-Own-Operate-Transfer/ Build-Operate-Transfer models of implementation be the preferred means of implementation,” the telecom regulator said in its recommendation titled ‘Implementation Strategy for BharatNet’.
At present, a special purpose vehicle Bharat Broadband Network Ltd (BBNL) under Telecom Ministry is handling roll out of optical fibre network.
The project is being executed by BSNL, RailTel and Power Grid.
TRAI also said the task of rolling out broadband network should be given to a concessionaire selected through reverse bidding process to arrive at fund to be provided by the government.
Pushing for PPP model, TRAI said, “a BOOT operator having significant incentive to complete the project in time, as his revenue stream from the project starts only on its completion, is more likely to anticipate problems and make all the efforts to resolve them early so as to complete the project well in time. The risk of delay in completion of the project is relatively less in such model than in EPC model.”
TRAI added that the current proposal envisages the network to be auctioned at the district level. “This concept is fraught with the 28 danger of creating an administrative nightmare. Implementation of this proposal will result in a complex and unmanageable web of contracts. Assuming that one entity is auctioned one pair of fibre, there will be a minimum of a dozen contracts at each district. This will put the total contracts pan-India at 6,000 at the minimum.”
The regulator said that it is desirable to structure the private sector’s involvement in a manner that aligns long-term incentives with the State’s social and public service delivery objectives.
The project was formally approved by the Union Cabinet in December 2011 with the vision of increasing affordable and high-quality access to 2.5 lakh Gram Panchayats by laying 6,00,000 km of incremental optical fibre in three phases to be completed by 2015.
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