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June 4, 1997


VSNL plans gateways in three more cities

The Videsh Sanchar Nigam Limited, India's monopoly provider of international telephony and Internet services, is to set up full-fledged gateways in Ernakulam, Jhalandar and Ahmedabad.

These gateways are expected to be functional by early 1998. Senior VSNL officials have said the approvals for gateways are in the final stages and are awaiting the approval of the Department of Telecommunications.

These full-fledged gateways are a result of the recent memorandum of understanding signed between DoT and VSNL, which allows the VSNL to set up additional full-fledged gateways in the country in order to strengthen international telecommunication networks and to cater to the needs of the identified traffic centres.

The full-fledged gateways will include earth stations and switching equipment which is expected to improve the call-completion rates as well as call access to subscribers from these cities.

As of now, all international calls are being routed through the company's gateway in Bombay. Sources pointed out that the gateways in these cities will ease international traffic and increase revenues.

They said that the international traffic from each of these cities roughly constitute about 100 million paid minutes per annum.

The gateways are a part of the company's Rs 8.25-billion plan towards capital expenditure for the current year. The company is also planning a Bombay-Arvi, as well as New Delhi-Dehradun microwave system, with an investment of Rs 200 million.

VSNL sources said that the company will actively seek expansion through joint ventures and enter new areas such as domestic and international value-added services, regional hubbing of traffic and to position India as a major regional telecommunications operator.

VSNL, in its memorandum of understanding with DoT, has targeted 1.51 billion paid minutes through telephony for the current year. The company has also planned to set up 400 lease voice/data circuits, including 64 kbps circuits. The total capital employed for the current year is expected to be Rs 25.54 billion.

In view of the worldwide phenomenon of decline in total accounting rates, DoT will take all actions to ensure that this is duly recognised in the revenue sharing agreements between DoT and VSNL. The MoU provides VSNL the freedom to decide on the choice of transmission medium and to establish their own links for interconnecting its gateways and earth stations.

VSNL also has the freedom to provide any value-added service or network or consultancy services either on its own or in association with parties, both from India and abroad.

In case of domestic value-added service, DoT would charge licence fee similar to that charged by DoT from other similar services, as provided for other such companies.

- Compiled from the Indian media

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