BSNL CMD Kuldeep Goyal asked the government to grant it a Preferred Service Provider Status in those border areas where the government has directed it to refrain from using equipment from Chinese vendors.

BSNL’s logic is that if the government finds it objectionable from a security point of view then the directive should be applicable to private operators as well in those areas.

“Currently, the Home Ministry has asked only BSNL to refrain from using Chinese equipment. That is not fair. If the ban is to be made effective then government arms and employees should be mandated to use BSNL''s services, in those areas,” said the CMD.

According to the CMD, the directive against use of Chinese equipments will lead to increase of capex of atleast 1.5 times.

While BSNL has granted an 8 million GSM line contract to Huawei for the Southern region as part of its mega GSM contract, it is yet to reach a conclusion with Ericsson for the price in the Northern and Eastern region. In fact now it has issued a directive to all its zones to refrain from issuing any new purchase orders as well as putting on hold recently issued purchase orders for the contract. It is considering re-tendering of the contract.

BSNL’s dilemma is justified since it is faced with multiple challenges. The PSU is already facing slowed down sales as compared to private operators. The government’s directive against use of Chinese equipment in border areas will lead to increased cost as compared to private operators. Also the directive does not apply to private operators. Hence the PSU reasons that it leads to violation of level-playing field.