victor he 8wOToN7KeQ4 unsplash

Reliance Jio sees its lifeblood in the state government’s free smartphone project

The government of Rajasthan, India’s seventh most populous state, is due to present its budget for the year ending March 2024 in February. And executives at India’s largest telco, Reliance Jio Infocomm — which saw a modest 1.2% growth in its subscriber base in the three months to December — have reason to be excited.

In focus is an ambitious project targeting some 13.3 million women and their families.

In the 2022-2023 budget, Prime Minister Ashok Jehlot announced a populist scheme to distribute free smartphones and data as part of the Mukhyamantri Digital Seva Yojana. By mid-2022, the state — which goes to the polls later this year — has begun receiving bids from Jio as well as other telecoms companies like Bharti Airtel and state-owned BSNL.

The tender document only qualified telecoms companies to bid for the contract, but Jio and Airtel’s cash-strapped rival Vodafone Idea stayed put. Jio made its bid along with original equipment manufacturers (OEM) Samsung and Nokia. More importantly, an upgraded version of the JioPhone Next — which otherwise didn’t see much success — was also part of the proposal, officials linked to the scheme said.

Bharti also has a partnership with Samsung. It is unclear if BSNL also has an OEM partner.

The telecom arm of Reliance Industries, led by billionaire Mukesh Ambani, has emerged as the lowest bidder, effectively paving the way for the company to pocket 60% of the total contract value of approximately US$1.5 billion. Jio’s closest competitor, Bharti Airtel, has taken the rest.

For some



New Indian Express
Gehlot prevalence: 1.35 crore women have access to smartphones
Read more

In November 2022, the supply of devices was scheduled to begin in mid-December. But there was a huge delay. While some recent reports have said the project has been delayed, an official close to Rajcomp Info Services – the IT consultancy organization responsible for implementing the scheme – said the government will state the status of the project in a budget document on February 8.

The state government expected the cost to be lower than the lowest bid. A senior industry executive said, he has not made an appropriation of Rs 12,000 crore (about US$1.5 billion) for this project. In contrast, the state government spent ₹12,000-13,000 crore (US$1.5-1.6 billion) on health and rural development in 2021-22.

Neither the Government of Jew nor the Government of Rajasthan responded Ken inquiries by the time of publication. Also, the officials and industry executives named in the story did not want to be named because they were not authorized to speak with the media.

If the deal goes through, it will be a necessary win for Jio. After all, Jio’s revenue share of the market in the Rajasthan constituency in the September-ending quarter saw a decline from the same quarter in 2021, while Bharti’s share increased over the same period.