Gail, Tata, VSNL mull telecom hub

By SiliconIndia   |   Wednesday, 24 March 2004, 08:00 Hrs
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KOLKATA: Gail (India) Ltd is in talks with Tata Teleservices and Videsh Sanchar Nigam Ltd (VSNL) for setting up a telecom hub in southern India that will help expand its bandwidth network in the region.
"A deal is likely with either company very soon," a Gail source said. Gail provides bandwidth to telecom service providers.

Gail’s telecom arm Gail Tel plans to invest Rs 300 crore over the next four years to add 10,000-km of optic network, mainly in southern India. Connecting cities like Bangalore and Chennai to its network is uppermost on the company’s agenda. The proposed 10,000-km network, that Gail is currently working on will come up along the national gas grid.

Gail Tel, with a designed bandwidth of 160 gbps of which only 10 gbps capacity is installed, laid an 8000-km optic fiber network connecting 73 cities at an expenditure of around Rs 250 crore. The company is in talks with the Tatas for swapping of excess bandwidth. Gail has excess bandwidth in north India. "We want to be able to give country-wide bandwidth access," the source added.

Gail is planning to hive off Gail Tel into a separate company once the Indian government’s divestment process is over. According to the company, Gail Tel has strong potentials for independent growth that has prompted the management to consider turning it into a separate entity. The demand for bandwidth among telecom service providers is expected to propel Gail Tel’s fortunes.

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