MTNL chairman and managing director S Rajagopalan told The Financial Express that if the company is allowed by the government to enter the domestic long distance services market, it will certainly do so.

"We have not yet decided how to go about it. But, it can be as a joint venture with TCIL, as in the venture there is a combines service and project experience," he said.

The Department of Telecommunications (DoT) currently enjoys a monopoly in the lucrative domestic long distance services market. As per the National Telecom Policy of 1994, DoT's monopoly status will be reviewed next year after which the market is expected to be thrown open to competition from the private sector.

According to industry analysts, MTNL's plans to enter the domesticlong distance services market will complement its existing basic services networks in Mumbai and Delhi. "The long distance traffic between these two metros is one of the highest, and if MTNL can enter domestic long distance services, it can provide the entire range of services on its own," said an analyst.

MTNL has already announced its plans to participate in the fourth round of bidding for basic service licences in a joint venture with TCIL. Unlike the previous rounds of bidding where the licence fees were on a fixed basis, in the fourth round, the licence fees is expected to be on a revenue sharing basis which is similar to MTNL's current licence agreements for Delhi and Mumbai. It is understood that the joint venture will bid for two circles one of which is expected to be West Bengal.

In addition to bidding for basic services licences, the company has already announced its plans to provide cellular services in Mumbai and Delhi.

However, this move of MTNL was challenged by the private cellularoperators and the Telecom Regulatory Authority of India invalidated MTNL's licence to provide cellular services in the two cities. MTNL has moved the Delhi high court challenging the regulator's decision and the court is yet to give its final verdict.