Using the spatial modulation approach, where only one transmit antenna is active at a time, we propose two transmission schemes for two-way relay channel using physical layer network coding with space time coding using coordinate interleaved orthogonal designs (CIODs). It is shown that using two uncorrelated transmit antennas at the nodes, but using only one RF transmit chain and space-time coding across these antennas can give a better performance without using any extra resources and without increasing the hardware implementation cost and complexity. In the first transmission scheme, two antennas are used only at the relay, adaptive network coding (ANC) is employed at the relay and the relay transmits a CIOD space time block code (STBC). This gives a better performance compared to an existing ANC scheme for two-way relay channel which uses one antenna each at all the three nodes.
It is shown that for this scheme at high SNR the average end-to-end symbol error probability (SEP) is upper bounded by twice the SEP of a point-to-point fading channel. In the second transmission scheme, two transmit antennas are used at all the three nodes, CIOD STBCs are transmitted in multiple access and broadcast phases. This scheme provides a diversity order of two for the average end-to-end SEP with an increased decoding complexity of O(M3) for an arbitrary signal set and O(M2√M) for square QAM signal set. Simulation results show that the proposed schemes performs better than the existing ANC schemes under perfect and imperfect channel state information.