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A new line

The Indian railways draws up its blueprint for a foray into the telecom sector

The Ministry of Railways has drawn up its blueprint for a foray into the telecom sector.

It has suggested that the project be done in three phases. The first world involve two of its undertakings, IRCON International and Rites, setting up

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joint ventures -- in which they would have majority stakes -- with established telecom firms, to lay optic fibre cables from Bombay to Delhi and Bombay to Madras.

In the second phase, the ministry hopes to float tenders calling for either private firms or a consortium to lay cables from Delhi to Calcutta, Calcutta to Bombay and Calcutta to Madras under a build-own-operate-lease scheme.

The third phase would involve the railways updating its telecom network and using it commercially, as called for in the McKinsey report which suggested that the Asia Development Bank should fund the railways so that it could commercialise its network.

The railways initially plans to carry data and Internet traffic. After the monopoly of the Department of Telecommunications over long-distance calls is reviewed in 1999, it hopes to expand further.

The investment of Rs 2.5 billion for the first phases will come from the joint venture partners of the railway undertakings. The railway board would not interfere with the selection of the joint venture partners but only ratify the final selection. The Rs 2.5 billion for the second phase will be go to the best bidder.

-Compiled from the Indian media

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