Monday, January 22, 2001
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`There are plans of investing Rs 100 cr for VSNL expansion' 

 
While the government ruminates the disinvestment of Videsh Sanchar Nigam Limited (VSNL), the top brass at the state-run organisation is quietly preparing for the changes that are in the offing for the organisation. There is a strong belief that not only will VSNL weather the loss of its monopoly over ILD telephony in March 2002, but it will compete effectively and efficiently in the deregulated scenario. Chairman and managing director Shailendra Kumar Gupta gives out some details of what the roadmap ahead is going to be like in an exclusive interview with Shalini Dagar.

Excerpts:
What is your agenda for the coming year?
The primary goal is to increase our Internet network throughout the country. That is top priority for us. Constantly increasing and improving the bandwidth capacity is yet another. We hope to add at least 1000 MB in the coming year.

Next on the agenda would be strengthening of our gateways by installation of ATM equipment. We are also hopeful that our Domestic Long Distance (DLD) as well as the Direct to Home (DTH) projects would take off in the coming year.

How is VSNL planning to cope with the loss of its monopoly on International Long Distance (ILD) in the post-2001 era?
Firstly, it isn't as if the monopoly will end in a day. There will be new entrants, but it will take them some time to get their act together. Yes, there will be challenges. The environment will become competitive and we too will have to compete. However, we are not new to competition. We have been competing as an Internet Service Provider for quite some time now, and very well at that.

And we are planning to enter newer areas such as the domestic long distance market to combat with the situation.

So what exactly are the roll-out plans for NLD?
As of now even the draft licence agreement also has not been prepared. Hence, we can come out with our plans only when the knots in the policy are untied. Of course, we will begin by linking up cities where we already are present in some form or the other - in those cities where VSNL either has existing networks, gateways or earth stations.

"There are plans of investing Rs 100 cr in VSNL expansion"What are the plans for the ISP business?
To have an all-India presence as an ISP is top priority for VSNL right now. At present, we have a customer base of 5.5 lakh and we are present in only six cities. In each of the cities that we are present in we have a major share of the market. As regards dropping tariffs is concerned, we are quite clear: We have no intention of matching the cheapest tariffs. And competition is managed on both quality and price issues.

We are planning to go to three additional cities such as Jalandhar, Ernakulam and Coimbatore. Progressively, be present in 15-20 cities by the end of 2001. These could be towns such as Dehradun, Kanpur, Guwahati, Indore etc.

There are plans of investing Rs 100 crore in funding this expansion plan. We have already invited bids for the equipment.There were issues of renegotiation of VSNL's alliance with FLAG...There is no renegotiation on the anvil. As far as we are concerned, we have a legal, commercial agreement with FLAG. Whatever, bandwidth FLAG sells, it sells exclusively through us.

Further, we have slashed rates for bandwidth, lease lines as and when it was possible. We have addressed the concerns that the market had as far as rates are concerned.

After Indiainfo.com deal went sour, has VSNL reconsidered any portal alliances?
Yes, there is an internal committee which is evaluating the situation. And it is expected to come out with its decisions shortly.

There are quite a few disinvestment plans doing the rounds. What is the ground reality?
The matter as of now lies with the ministry of communications and the department of disinvestment (DoD). We are just the professional managers of the organisation.

Earlier, VSNL had recommended that the government equity be reduced to below 50 percent, after which the performance be measured and then a decision be taken on whether further disinvestment is required and to what extent as also whether a strategic partner is needed.

There seems to quite a lot on the VSNL plate in the days ahead...Yes, VSNL have a lot many things to do in the coming days, even as the government decides what it has to do with VSNL.

Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.

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