Firming up its plans to launch telecom services in the country, Reliance Jio Infocomm (RJIL) has signed an infrastructure-sharing agreement with Reliance Communications. The companies did not divulge the financial details.

Under the deal, the third between the companies, RJIL will utilise RCom’s nationwide intra-city fibre network for launching its fourth-generation (4G) telecom services across the country.

Optical fibre network The agreement is based on arm’s length pricing at prevailing market prices. RCom’s intra-city optical fibre network extends to nearly 500,000 fibre-pair kilometres across the top 300 cities and towns in India, RCom said in a statement.

RJIL is the telecom arm of the country’s largest private sector company Reliance Industries Ltd (RIL), controlled by billionaire Mukesh Ambani. RCom is controlled by his younger sibling Anil Ambani.

While the companies did not disclose the financial terms of the agreement, industry sources expect RCom to get ₹5,000 crore over the next 16 years (licence period) from the deal.

This is based on the rough estimate of the total fibre and the prevailing market prices.

RJIL, which holds 1800 MHz spectrum across 14 circles and 2300 MHz across 22 circles, plans to launch services by October or December this year.

In addition to telecom services, the company is planning to offer TV channels on its 4G broadband network.

THIRD DEAL In April 2013, the companies signed an inter-city optical fibre sharing agreement, and this was followed by a telecom tower infrastructure agreement in August 2013.

In March this year, RJIL also inked a telecom tower-sharing agreement with Bharti Infratel. Shares in RCom closed up 3.41 per cent at ₹133.55 apiece on BSE on Monday, after the company announced the agreement.

However, shares in RIL ended 0.02 per cent lower at ₹944.05 in a weak market.

>rajesh.kurup@thehindu.co.in

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