Gujarat Fibre Grid Network Ltd (GFGNL) has set an exceptionally high minimum annual turnover requirement of Rs 4,700 crore for bidders implementing the Centre-funded Amended BharatNet Programme (ABP) in Gujarat. Despite repeated representations from prospective bidders, industry associations, the eligibility threshold has been retained as some kind of a wall, raising concerns over restrictive tender conditions, reduced competition, and the potential for uncompetitive pricing. Notably, even BSNL has objected to this hyper turnover requirement conveniently forgetting that it pulled the same tactic for the Rajasthan orders of BharatNet project. It seems more a turnover barrier to competition than a turnover criterion.
The Rs 5,629-crore Gujarat project envisages upgrading 14,229 existing Gram Panchayats to ring topology, covering 508 new GPs and extending connectivity to 4,141 villages. The turnover criterion appears whimsical and deficient on several counts. Turnover-to-project-cost ratios have ranged from 20 to 82 per cent in BSNL’s 2024 tenders. The absence of a uniform framework from Digital Bharat Nidhi (DBN) raises questions about consistency and transparency in public procurement.
What is the justification for Rs 4,700-crore threshold? BharatNet contracts include both capital expenditure (capex) and long-term operational expenditure (opex), with implementation spread over three years and operation and maintenance extending to ten years. Our calculations show that based on a realistic first-year funding requirement as the benchmark, the Gujarat project's eligible turnover requirement could reasonably be around Rs 1,700 crore rather than Rs 4,700 crore.
The issue extends beyond Gujarat. Maharashtra's Rs 10,520-crore ABP project also has a remarkable absence of standardised financial eligibility norms, that could allow state implementing agency to impose arbitrary and potentially exclusionary conditions.
The larger question is whether DBN, under the Department of Telecommunications, should establish a rational, uniform and proportionate turnover framework that reflects actual project financing requirements rather than total contract value, including long-term opex. Without such intervention, an ambitious national rural broadband programme risks restricting domestic vendor participation, weakening competition and compromising the efficient utilization of public funds.
