Airtel, Reliance may bid for GSM licence in Bhutan

16 August 2006

Government owned entities, including MTNL and TCIL which had together operated a mobile network in Nepal, have been barred from bidding for a GSM-based mobile service licence in Bhutan.

TCIL had completed the expansion of the GSM network and its pre-paid billing system, along with the annual maintenance contract, at a combined cost of $3.03 million in Bhutan.

Indian mobile operators that have evinced interest in bidding include Bharti Airtel and Reliance Telecom.

Bhutan started mobile services in November 2003 and has about 50,000 cellular subscribers and over 40,000 fixed-line customers. State-owned Bhutan Telecom Ltd is the sole operator until now. This would be the second mobile licence in the Himalayan kingdom, which has a population of just under 7 lakh.

The foreign bidders will have to enter a partnership with a Bhutanese company and will be able to take a maximum 49 per cent equity stake in the joint venture. Radio frequency spectrum of 2x10 mhz will be provided to the licensee while the band, yet to be specified, will be assigned to the licensee in accordance with the terms and conditions of the licence.

Bhutan had invited global bidders in a bid to liberalise the country's telecom industry, as local operators do not have adequate funds to roll out services in the mountainous region on their own.