Two years after negotiating a Rs 407 crore loan from the Asian Development Bank (ADB) and after spending nearly Rs 50 crore as commitment charges, the department of telecommunications (DoT) is still undecided about whether or not to go ahead with the loan. The only problem with the delay in taking a decision is that the loan expires by the end of the month.

At its meeting on Wednesday, the Telecom Commission has given time till November 10 for the committee finalising the details of this loan to give its firm view on how to progress on the loan.

In 1994, the DoT had identified 31,788 remote villages of Uttar Pradesh where there were great difficulties in accessibility and hence telecommunications facilities could not be provided. The ADB loan was negotiated for providing telecommunication facilities in these villages. The total project cost was to be of the order of $ 169 million (Rs 600 crore) with the ADB expected to get $113 (Rs 410 crore) and DoT bringing in the balance Rs 200 crore.

The project has been fraught with problems right from the beginning. After getting a commitment for the loan, the DoT took nearly one year to finalise the terms and conditions and technical specifications for the equipment required for this project. It was only a year later that the DoT floated a tenders for this project earlier this year. The tender got embroiled in controversy as the Tender Evaluation Committee (TEC) rejected all the bidders saying that they were unable to match the specifications given by the DoT. However, desipte this they shortlisted two PSUs - Bharat Electronics Ltd and Punwire as they came somewhere close to the specifications and had their products available for inspection. Most of the other companies bidding for this project cried foul at the TEC's decision.Following this, high level committee headed by the adviser (technical) in the DoT was set up in August to have a second look at the tender conditions and modify the tender conditions. Since then there has been no decision on the tender.

The committee members are now having serious doubts over whether these small companies would be able to handle such a complicated project for rural telecommunications. For the present, of the potential of 84,992 remote stations only 31,788 will be provided telephones. In addition, 4,768 village PCOs will be provided.y

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.