The Hindu : Business : BSNL cuts cost of GSM order

Online edition of India's National Newspaper
Friday, Jul 20, 2007
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BSNL cuts cost of GSM order

Special Correspondent

NEW DELHI: BSNL has finally placed the order for mobile equipment of 14 million GSM lines with Swedish vendor Ericsson at a lower cost of $80 per line as against the original cost of $107 quoted by it in its bid.

Ericsson officials here have confirmed that they have received the advanced purchase order (APO) for 2G equipment and would start studying it shortly. The company has two weeks to convey acceptance by pledging a bank guarantee with the public sector firm.

Following curtailment of the final deal size, reduced by half to 23 million GSM lines, the contract now stands at $2 billion or about Rs. 8,000 crore. Of this, Ericsson being the lowest bidder is to get 60 per cent of the order or about Rs. 4,800 crore, while Nokia-Siemens, the second-lowest, would get 40 per cent or Rs. 3,200 crore.

So far as the 18.1 million lines allotted to Alcatel-ITI are concerned, BSNL officials have said that the size of this contract would be taken up at a later stage. However, Alcatel-ITI would have to quote the same price as that of Ericsson.

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