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WiMAX to reach rural India following BSNL grant

Indian state-owned operator BSNL has secured a government grant of US$524 million in order to deploy a WiMAX network across several rural regions that are not served by fixed broadband networks.

Construction of the wireless broadband network, which will bring high-speed internet access to previously underserved rural areas, was already underway when BSNL appealed to the Indian government for additional funds, claiming that it would not otherwise be able to complete the rollout.

The Indian government has requested that BSNL recalculate the cost of the deployment, cutting distribution and marketing budgets. The operator will pay back its expenditure over a twenty-year period, and is currently looking into the possibility of network sharing agreements as a means of reducing infrastructure costs.

In August this year, BSNL recorded its first ever annual net loss, which reportedly resulted in India’s government delaying an IPO for the operator. The additional compensation for the WiMAX network was one of several requests that BSNL made to the government as a means of reversing its fortunes.

The operator’s grounds for such requests were that it fulfils a ‘social workhorse’ role, providing ‘socially desirable activities’ without turning a profit, according to the Times of India. BSNL has also requested that its landline business be subsidised, and that specific government services must be run by the state-owned operator.

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