Vodafone Idea (Vi) and state-run Bharat Sanchar Nigam Limited (BSNL) have agreed to share their telecom networks across all circles in India, according to sources who spoke to CNBC Awaaz.

The agreement covers intra-circle and inter-circle roaming as well as sharing of towers and optical fibre infrastructure, the sources said.

The arrangement could allow Vi to earn additional revenue from BSNL subscribers using its network. Infrastructure sharing of this kind is a common practice in the Indian telecom sector, where operators pool towers and fibre to reduce capital and operating costs. For Vi, which has been working to fund network expansion while carrying significant debt, monetising its network through a roaming and infrastructure pact would represent a non-tariff revenue stream. For BSNL, which has been rolling out its 4G services, access to a partner's network footprint could extend coverage for its subscribers in the interim.

If confirmed, the deal would deepen cooperation between India's third-largest private operator and the state-owned carrier at a time when the market is dominated by Reliance Jio and Bharti Airtel, which together hold the large majority of India's wireless subscribers. BSNL has previously signed network-sharing arrangements with private operators, so the structure has precedent in the sector.

Neither Vi nor BSNL has publicly confirmed the agreement; the details currently rest on unnamed sources. Watch for official confirmations from either company, the financial terms of the sharing arrangement, and regulatory clearances, which are typically required for such pacts in India.

Source: CNBC-TV18