Bharat Sanchar Nigam Ltd has cancelled the tender for rolling out the optic fibre cable network for Defence forces.

This is the second time the telecom company has scrapped the tender for the Rs 7,000-crore turnkey project.

The project is important because the Defence forces had agreed to give up spectrum in key bands for use by mobile service providers. But even after five years since the project was first conceived, not much has moved.

BSNL was entrusted to roll out this cable system aimed at connecting key installations of the armed forces. But the company has not been able to close the tender for procuring the optical cable. BSNL had floated the tender initially in January 2010 but this was cancelled. A fresh tender was brought out in November 2012, which has also been cancelled now.

This comes after the company pushed back the last date for closing the tender five times since December. As many as 14 top companies, including L&T, Finolex and Punj Lloyd, had expressed interest in this turnkey project, which involves laying optical cable across 57,000 route km.

The network is supposed to connect 129 Army, 162 Air Force and 33 Navy installations. The Government has already earmarked $3 billion for the project. This was part of a deal signed in 2009 between the Ministry of Defence and the Department of Telecom.

The Telecom Department had agreed to set up an alternative network for the Defence and in return the Defence forces would give up spectrum for 3G and 2G mobile services.

Procedural delays and political interference has been hampering BSNL’s procurement process. The telecom PSU has had to scrap a number of tenders earlier, related to buying equipment for cellular services.

(This article was published on February 27, 2013)
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