BSNL may renegotiate GSM deal with Ericsson, Nokia

India's BSNL has decided to cut in half, in terms of number of lines, a contract to install 45.5 million GSM lines and renegotiate the contract price with the lowest bidders, a Total Telecom report said.

The Total Telecom report, quoting local media Business Standard report, said BSNL will renegotiate with equipment providers Ericsson and Nokia which earlier submitted the lowest bids, according to industry sources.

The state-owned company has also decided to strip out a portion in the contract for the installation of 3G lines, sources further said.

The contract will now only cover 2G lines and a separate tender will be floated for the 3G lines, the report said.

Earlier, BSNL chairman and managing director A. K. Sinha said the company's board will send its suggestions on the revised order to the government.

In April, Ericsson had emerged as the lowest bidder and Nokia as the second-lowest bidder in a tender to lay the lines.

However, the project stalled in May because India's new Communications and Information Technology Minister A. Raja wanted the telecom services provider to renegotiate the price to bring it down to below $100 per line, arguing that similar equipment had been supplied to other operators in India at a much lower price.