Bharti Airtel, Tata Communications, BSNL (Bharat Sanchar Nigam Limited), and Saudi Telecom are investing $400 million in an undersea cable link, the Europe India Gateway (EIG). BSNL, for whom it is to be the first undersea cable ownership, expects to be able to offer more competitive rates on its broadband and international tariffs.

Sources report that BSNL is to invest $50 million in the project. Such an undertaking on BSNL's part is perhaps intended to overcome threats related to Wi-Max, as BSNL, being the largest provider of broadband in the country, derives a good amount of revenue from the segment.

This move may cut down the company's cost of international bandwidth by 60 per cent. As it is, BSNL's aggressiveness in this segment is increasing, and its 2.5 million customer base is expanding. Presently, Reliance Communications and Bharti Airtel have the bandwith axis rate control, and BSNL is expected to reduce its reliance on the two telecom companies.

International submarine cables are divided into two regions - the  Pacific cable, which carries traffic through Malaysia, Singapore, and Japan, and the Atlantic cable, which carries traffic through the Middle East, the UK, and the US. The EIG cable, due to be completed by 2009, is an Atlantic cable link. Bharti Airtel's $300 million, 10,000km long Unity cable system is expected to sustain the growth in data and Internet traffic. X