India Telecom

Bharti signs interconnect agreement with BSNL

NEW DELHI -- Private sector telco Bharti is once again managed to stay one step ahead of the others by signing an interconnect with BSNL for national long distance.

Bharti Telesonic, part of the Bharti group of telcos, signed the interconnect agreement with incumbent basic services operator Bharat Sanchar Nigam Ltd. (BSNL) a government-owned company for carrying the former's national long distance service.

The significance of this agreement is twofold. This is the first interconnect agreement a private sector long-distance operator has had with the largest incumbent public sector basic service operator who is also a national long distance operator. At the same time, BSNL is yet to sign such an agreement with the privatized international carrier VSNL. The dispute over VSNL has been taken to Pramod Mahajan, the minister for IT and telecom.

N. Arjun, CEO of Bharti Telesonic Ltd said, "With the signing of the interconnect agreement, IndiaOne will now be able to extend its services to over 40 million fixed line subscribers of BSNL besides extending services to over 8 million mobile subscribers." Bharti has the license for operating national long distance (NLD) and international long distance (ILD) services under the IndiaOne brand name.

Bharti Telesonic has already signed agreements with BSNL and MTNL for carrying international calls. It is expected to sign on for carrying NLD traffic with MTNL on lines of the agreement with BSNL. When IndiaOne announced its NLD services, it slashed prices by 62.5 percent and subsequently, international carriage prices were reduced by 40 per cent. BSNL and VSNL had to bring down their charges as well. In fact, BSNL lost the margin it used to enjoy on NLD for offsetting losses in local call operations. BSNL and VSNL have lost money after they had to cut charges and are now asking the government to intervene for rescue.