Kathmandu-The Commission for Investigation of Abuse of Authority (CIAA) has intensified its investigation into alleged irregularities in Nepal Telecom’s (NTC) 4G expansion project.

The probe focuses on the project’s cost and the failure to meet the quality of ‘LTE 4G’ service as specified in the original design and contractual agreements. The CIAA is actively collecting statements to understand the extent of the non-compliance.

The CIAA has investigated this matter by investigating officer and team, according to a source close to CIAA.

'We are preparing to register a corruption case at the Special Court after closely monitoring documents and finding irregularities in the 4G project,' a source added. 

The investigation involves officials responsible for the procurement and the vendor, Huawei, which has established a monopoly in Nepal’s telecommunications sector.

Huawei’s mismanagement and negligence have deteriorated the quality of Nepal Telecom’s 4G, as found by the Nepal Telecommunications Authority (NTA) and internal investigations.

Meanwhile, Huawei has used diplomatic influence to evade the investigation.

Last year, the NTA conducted a drive test in Kathmandu and found that the NTC's  4G did not have the expected speed. Similarly, the internal assessment also did not find the expected speed. After the 4G expansion at a cost of Rs 19 billion , questions were raised in the procurement and process.

After all-round questions were raised, the CIAA initiated an investigation, and found that basic contractual obligations were not fulfilled by Chinese vendor Huawei,

Irregularities in the 4G process resulted in investment without consumer or company benefits, leading to losses.

The CIAA obtained the original documents from the 4G project tender and activated the statement after completing the investigation with the documents and technical assistance.

A key component costing Rs 700 million for Telecom 4G quality has not been installed. The ‘small cell’ equipment needed to speed up the 5G network is yet to be installed, and Huawei has overlooked it for a long time.

China Communication Service International (CCSI), an international agent and representative company for Huawei, is the main culprit in Nepal Telecom’s 4G expansion.

The company signed an agreement to install 6,000 small cell equipment but has not done work worth Rs 700 million. The lack of installation has affected the quality of the telecom’s 4G service even in Kathmandu Valley.

The agreement included a study of coverage capacity and installation of small cells after completing the 4G infrastructure and other works. The preliminary study showed that around 6,000 small cells would need to be installed during the tender.

Telecom uses frequencies from three bands for 4G: 800 MHz (low range), 1800 MHz (medium range), and 2300 MHz (2300 MHz band). Despite the agreement, small cells were installed to improve 4G coverage in urban areas, especially in the upper range band.

High-range frequencies have low coverage, while low-range frequencies lack good coverage in underground and deep places. Small cells were installed to improve coverage in densely populated areas.

Huawei has been working against the agreement, degrading the quality. Although the agreement mentioned using equipment from the US, Canada, Europe, Finland, and Australia, Huawei used Chinese antennas due to availability issues in the US and Europe. The CIAA is  also investigating use of  the equipment beyond the agreement.

NTC officials say the expected quality has not been maintained due to these reasons.

The NTA  had already warned Huawei’s weaknesses as a vendor were behind the poor 4G quality in Nepal. After research and consumer experience revealed poor performance, the NTA alerted Telecom and Huawei.

Huawei, responsible for supplying and installing most of the equipment through Hong Kong company ‘CCSI’, repeatedly violated the agreement and installed inferior equipment.

Huawei has been weakening the quality by violating standards for technology and equipment to improve and sustain quality and the agreement.