Fiber optic plays Sterlite Tech, Tejas Networks, HFCL abuzz before opening of BharatNet's tender

Companies like HFCL, STL, TCS, Tejas Networks have been reported to have shown interest to participate in the BharatNet tender process, either as individual companies or part of a consortium.

Shares of fiber optics companies are buzzing ahead of the opening of the mega tender for the next phase of BharatNet project by Bharat Broadband Network Limited on August 8.

State-run telecom company BSNL had floated a tender worth around Rs 65,000 crore to implement the third phase of the BharatNet project, earlier this year.

What is BharatNet

BharatNet is a rural telecom project, aimed at providing over two lakh Gram Panchayats access to broadband connectivity.

Bids for BharatNet had been invited to design, supply, construct, and install optical fiber cables, switches, routers and other equipment. This tender is part of the Rs 1.39 lakh crore revamped BharatNet project to connect and upgrade existing 164,000-gram panchayats and connect around 47,000-gram panchayats under the new model.

India Inc Stepping Up

There is an anticipation of a substantial private and public investment in enhancing India's fiber penetration, which could result in significant business for the optical fiber players.

Companies like HFCL, STL, TCS, Tejas Networks, among others have reportedly shown interest in participating in the tender process, either as individual companies or as part of a consortium.

The fiber roll-out services market is highly fragmented in India, and pan-India players like Sterlite Tech are leveraging on technological capabilities and project management experience to add value for telecom operators.

Tejas Network had supplied broadband access equipment for BharatNet Phase1 and 2 and Railway’s public Wi-Fi projects which were deployed in nearly one lakh villages and over 4,000 railway stations acorss India as of end of FY24.

Ambitious Plans

The government on August 2 said that the next phase of rural internet connectivity under the BharatNet project will target to bring all Gram Panchayats online. The groundwork of setting up the optical fiber cable networks is being carried out across the country. This will ensure broadband internet connectivity to the rural India.

Under the two phases of BharatNet, 2.13 lakh Gram Panchayats are now ready to be brought online. In addition to this, the amended BharatNet project will also focus on providing optical fiber connectivity to 42,000 uncovered Gram Panchayats and remaining 3.84 lakh villages.

Telecom Minister Jyotiraditya M Scindia recently said that the government is targetting 100 per cent coverage of villages in terms of telecom connectivity in the next 12 months.

Scindia also said that Rs 27,000-crore semi-conductor unit by the Tata Group near Guwahati is a ‘game changer’ for the entire North East region.

BharatNet's Tender

The BharatNet phase-III project is a three-tier architecture having leased line bandwidth, to be provided by BSNL at 7,269 blocks across India. The middle-mile connectivity will involve private players to operate and maintain the project for 10 years, and the last-mile connectivity, which is village-to-household, will be provided through the 'Udyami' model of village-level entrepreneurs who will help the government to take the fiber connections to the homes on a 50:50 revenue-sharing basis.

The BharatNet program and the tender for Rs 65,000 crore for BharatNet Phase 3 is expected to substantially increase the size of India's fiber roll-out services market.

Digital Push in Budget

The budget too has doubled down on Digital Public Infrastructure (DPI), expanding it to new sectors, including agriculture.

Centre, in partnership with states, has assured to facilitate the implementation of the Digital Public Infrastructure(DPI) in agriculture for coverage of farmers and their lands in 3 years. Finance Minister Nirmala Sitharaman, while presenting the Budget for 2024-25 in Parliament said that during this year, a digital crop survey for Kharif using the DPI will be taken up in 400 districts. She said the details of 6 crore farmers and their lands will be brought into the farmer and land registries.