Huawei is set to build a NPR 484 million ($3.5m) data center for Nepal Telecom.

The pair signed a Letter of Intent for a primary data center in Kathmandu, Nepal, and a disaster recovery center located 265km away in Bhairahawa.

The Chinese tech giant will be responsible for the data center’s physical infrastructure.

A spokesman for Nepal Telecom, Hari Dhakal, said the data center will modernize the company in its data handling and will become a key part of delivering efficient service.

Details of the proposed facility were not shared, nor were other details of the deal.

Dhakal added the facility could generate income for the telecom. Nepal Telecom, like Ncell, has seen its revenues decline in recent years.

The state-owned telco was a monopoly until 2003, when United Telecom, a privately owned operator, entered the market.

Huawei has teamed up with other countries to aid digital transformation, for example, last year, Huawei partnered with the Algerian government and the National Bank of Pakistan for data center builds.

At the end of last year, the Chinese vendor stressed that telcos must begin to prepare for an AI future, pushing for 5G rollouts.

According to DataCenter Map, Nepal is home to operators such as Cloud Himalaya and DataHub. Telcos Ncell and Subisu also have facilities in the country.

Last year, Indian data center operator Yotta and Nepal’s BLC partnered to build a data center outside Kathmandu, Nepal.