It is one of the biggest foreign investment deals of all time in Indian infrastructure, and there could be more to come.

Last month, Brookfield Asset Management took control of Reliance Jio Infratel, the towers business of Indian service provider Reliance Jio. The operator, which has shaken up the entire mobile market since its arrival in late 2016, is now eyeing a similar divestment of Jio Digital Fibre, its fiber business.

As with the towers move, a fiber sale should help RJio to address its financial woes. Brookfield's investment in Infratel will help to clear some of its INR365 billion ($5.2 billion) in liabilities. Reliance Industries, RJio's parent company, had total debts of INR2.87 trillion in March this year.

Besides allowing RJio to lower debts, the moves should provide additional funding for the expansion of its enterprise and Giga Fiber businesses. Earlier this year, Jio Digital Fibre raised about INR270 billion ($3.9 billion) in loans from a consortium of banks, including $1.59 billion from the State Bank of India, $720 million from ICICI Bank, another $720 million from Punjab National Bank and $860 million from Axis Bank.

But more may be needed for the company's plans. Having quickly grown into one of India's largest mobile service providers, RJio is keen to replicate that success in the markets for fiber broadband and enterprise services through the launch of competitively priced deals. Some funding could also go toward the acquisition of 5G spectrum, since auctions will be held later this year.

"The divestment of the tower and fiber assets is a good way for Jio to monetize its assets," said Mahesh Uppal, the director of Com First, a consulting company focused on the telecom sector. "The value of the tower and fiber assets can be better realized if they belong to a third party. The other tenants would be more inclined to share if it is not owned by their competitors. Furthermore, assets like tower and fiber are very easy to share and to charge for."

RJio currently maintains about 300,000 kilometers of fiber that could feasibly be leased to other players under new ownership. And while potential buyers have yet to emerge, the assets look attractive, says Deepak Kumar, the founder of market research firm B&M Nxt.

“The sheer fact that right-of-way hurdles have been addressed across all service areas and the fiber laying has been done in a future-proof manner boosts the quality of this infrastructure asset," he says. "Reliance Industries would be aiming for a valuation in accordance with this asset quality and the tower assets deal duly paves the way."

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RJio is not the only service provider divesting infrastructure assets. Earlier this year, Bharti Airtel transferred 32% of its stake in Bharti Infratel to its wholly owned unit Nettle Infrastructure. The move was aimed at supporting monetization of the tower assets. Similarly, Bharti Airtel and Vodafone Idea have merged their fiber assets into a venture called Telesonic. In the long run, Telesonic will be an independent fiber company leasing capacity to service providers and Internet companies.

Changing market dynamics could explain the interest. With the emergence of 5G, the "Internet of Things" and smart city services, the traditional model and core value proposition of the telcos needs to be reworked. Sunil Bharti Mittal, the chairman of Airtel owner Bharti Enterprises, has previously talked about the concept of a "netco" that could manage infrastructure independently and take connectivity into remote areas of the country, allowing telcos to focus on service development. Perhaps the Indian market is slowly moving towards multiple netcos.

— Gagandeep Kaur, contributing editor, special to Light Reading