India’s state owned BSNL has fallen behind on payments to the Finish kit maker, for products and services associated with 2G and 3G
Network equipment providers in India are beginning to lose patience with the country’s cash strapped network operators, as Nokia becomes the latest company to voice concerns.
A report in the Economic Times of India quoted sources close to Nokia as saying that the company was considering removing services to India’s fourth biggest operator, BNSL. The move could have serious consequences for 2G and 3G coverage levels across the country.
“There is tremendous pressure on us. We have been asked to shutdown services we offer to BSNL by the top management executives in the headquarters due to continued non-payment of our outstanding amount,” a person privy to the matter told journalists from the Economic Times of India.
BNSL owes Nokia unpaid dues of approximately $112.9 million (800 crore Rupees) for various network equipment and services.
India remains one of the most hyper competitive telecoms markets in the world, with operators forced to subsist on ARPUs of just $1.50.
Nokia is the latest network equipment provider to run out of patience in India. Earlier this year Ericsson called for the incarceration of RCom’s chairman, Anil Ambani, over unpaid debts of around $78 million. In October 2018, Ericson filed its initial contempt petition against Ambani, over the long-standing debt. Reliance Communications (RCom) asked Ericsson for an additional 60 days to make payment of the debt – a request that was flatly refused by the Swedish kit maker. In the end, Ambani narrowly avoided jail, thanks to a cash loan from his brother, Mukesh Ambani, which allowed him to make payment of the arrears.
Nokia’s spat with BNSL comes as operators across the country are trying to raise funds to invest in their next generation, 5G networks.
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