Reliance Jio and Bharti Airtel have won a new contract worth Rs 3,683 crore ($484.6 million) from the Indian government to provide 4G mobile services in uncovered villages of “aspirational districts” in the country.
Under the project, Jio will roll out 3,696 towers for $373 million, whereas Airtel will install 1,083 mobile towers with an expenditure of $111 million.
According to a report by newswire PTI, both private telcos have been given 18 months to roll out 4G services in the identified villages.
The project will be funded by Universal Service Obligation Fund (USOF). It is expected to be completed by November 2023.
The USOF is a $7.63 billion reserve to fund rural and remote digital connectivity. Indian telecom operators have to pay 5% of their adjusted gross revenue (AGR) towards the USOF levy.
The Indian government wants availability of 4G services in 7,287 uncovered villages of 44 aspirational districts across five states of Andhra Pradesh, Chhattisgarh, Jharkhand, Maharashtra and Odisha at an estimated cost of implementation about $850 million including operational expenses for five years.
The project was approved by the Cabinet last year.
Airtel’s 4G deployment will be focused on Jharkhand and Maharashtra, while Jio’s deployment will focus on remaining three states.
India’s state-run telco, BSNL, recently complained about losing out to Airtel and Jio on lucrative government-funded digital connectivity programs for unconnected villages.
BSNL reportedly didn’t bag a single mobile project in the last five years, as all USOF projects were given to Airtel and Jio in the name of open tendering.
BSNL chairman Pravin Kumar Purwar recently told Indian media that the state-run telco was in the best position to complete the connectivity program within the 24 months from the date of award. He said that BSNL has the past experience of rolling out mobile networks in difficult terrains.