European and Chinese gear vendors said that the ongoing network-related dues issue with India’s Bharat Sanchar Nigam Limited (BSNL) would dent the country’s image as an investment destination for global investors.
These vendors have urged India to intervene and take “affirmative action” to expedite pending payments.
BSNL owes over $135 million to Nokia and ZTE, both of whom bagged contracts from the telco to deploy 40,000 broadband sites in 2017. Nokia provides network technology to BSNL in South and Western zones, while China’s ZTE is the network vendor for East and North zones.
On the other hand, Ericsson and UTStarcom are seeking to recover around $67 million each from the telco in CAPEX and OPEX dues.
“In spite of several follows-ups and many commitments, the outstanding payment is still pending. This not only creates business challenges for us but also reflects adversely on India as an investment destination for global investors,” a Nokia spokesperson said in a statement issued to Indian media.
Nokia added that it had been committed to powering BSNL and MTNL networks that have kept people connected and have sustained economic activities during this pandemic.
Nokia had previously reached out to India’s Prime Minister Narendra Modi to seek his intervention in recovering network-related dues from the telco.
China’s ZTE said that its management had supported the India team to keep BSNL’s network operations. “While they [HQ] have not withdrawn support, there are a lot of challenges without money,” the vendor’s spokesperson was quoted as saying by the Economic Times.
ZTE powers both core and radio networks of BSNL in India.
Interestingly, BSNL has reportedly decided to bar ZTE and Huawei from its phase nine 4G network expansion.
UTStarcom, which currently supports BSNL’s 3G, transmission and NGN network, said that the payment-related issue had derailed its India expansion plan. It was previously planning to set up its manufacturing plant and a research and development centre in India.
“Situation is not good because we haven’t been paid for the last 4-5 months. December was a crucial month, and BSNL gave in writing that all dues will be cleared. It is a terrible situation. We don’t know how to run the operations, and it has impacted our expansion plans,” UTStarcom India Managing Director Rahul Pandey was quoted as saying by the publication.
Notably, BSNL has already invited applications from Indian companies to provide equipment for the rollout of 4G service in the country.
BSNL has only allowed domestic equipment vendors to provide 4G core technology. State-run C-DOT (The Centre for Development of Telematics), PertSol and Mavenir have reportedly claimed that they can provide 4G core for the telco’s upcoming 4G network.
Multinational vendors like Nokia, Samsung and Ericsson can only bid for the 4G RAN after depositing their source code in an escrow account. The report said that Nokia, Ericsson and ZTE have expressed their interest to bid for the BSNL despite the ongoing payment issue.