Bharti Infotel Limited (Merged with Bharti Airtel Limited)

Active

Prospective

In 1996, Bharti Telenet Ltd. (renamed to Bharti Infotel in 2003) was awarded a 15 year license to become the first private provider of basic local phone/landline services for the telecom circle of Madhya Pradesh. Bharti Telenet also acquired cellular service license to operate in Himachal Pradesh. Bharti Telenet was originally owned by Bharti Tele-Ventures Limited (70%), Telecom Italia (30%) in 1999. As of October 2000, Bharti Telenet Limited became a wholly owned subsidiary of Bharti Tele-Ventures Limited. Bharti Tele-Ventures decided to consolidate all the non-mobile licenses (fixed line, long distance and broadband businesses) under one entity. In August 2003, the cellular operations of Bharti Telenet Limited (H.P. Division) merged with Bharti Cellular Limited, subsidiary of Bharti Tele-Ventures Limited. In September 2003, Bharti Telesonic Limited and Bharti Broadband Networks Limited merged with Bharti Telenet Limited. Post merger, Bharti Telenet was renamed Bharti Infotel Limited. Bharti Infotel operated fixed line operations in Madhya Pradesh, Chattisgarh, Haryana, Delhi, Karnataka and Tamil Nadu as well as nationwide long distance and broadband networks. In November 2003, Government of India introduced Uniform Access Licensing covering both fixed and mobile services – service providers were allowed to offer both fixed and mobile services, using technology of their choice with greater flexibility in terms of operation and ownership structure. In 2004, BTVL obtained uniform access service license for all the 23 circles in India and had migrated to the new regime. In June 2004, Bharti Infotel surrendered its redundant fixed line service licenses in four circles namely Delhi, Haryana, Karnataka and Tamil Nadu. As of June 2002, the company held a 20-year license valid from December 12, 1995 as the original license was extended 5 years. The company had to pay a license fee of Rs 655 crore under the terms of the original license tenure. In June of 1999, the Industrial Development Bank of India (IDBI) disbursed a loan of Rs 100 crore to Bharti Telenet which was the first part of the Rs 250 crore loan for the project. However, the company had problems meeting its license fee commitments, prompting the government to switch to a new licensing fee system. To reduce the financial burden placed on the telecom operators, a new revenue sharing license fee structure was introduced with the New Telecom Policy in July 1999. This payment structure enabled all telecom license operators to switch to a new 15% revenue sharing policy, provided they complete their payment on accumulating dues by January 31, 2000 and that both operators in the circle agree to switch over to the new system. The company paid US$3.6 million for its license prior to switching to the new system. Bharti Telenet awarded a US$175 million contract to Alcatel and Motorola for its switching and CDMA based WLL equipment in 1997. The company had put in place a 1,000 km fiber optic backbone network between Indore and Bhopal. The company launched its basic phone telecom network in Indore in June 1998. Bharti Infotel operated its fixed line business through its Touchtel brand and long distance business through its ‘IndiaOne’ brand. In May 2005, the operations of BIL and Bharti Cellular Limited, Bharti Group’s mobile service provider, were merged into BTVL. As of 31 December 2005, BTVL offered GSM mobile services in all 23 mobile circles in India and provided broadband & fixed line telephone services in 15 telecom circles covering 79 towns. The total number of subscribers stood at 17.5 million as of 31 December 2005, which included 1.2 million broadbank and fixed line customers. In March 2006, BTVL was renamed Bharti Airtel Limited (BAL). 2005 investment figures were included in Bharti Airtel Limited (1489)

World Bank Group

Project

Government, Broadband, Telecommunications, Manufacturing (Industrial), Commercial