NEW DELHI: Debt burden and a lack of 4G services, among a few other factors, are the reasons for the losses of state-run telcos Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL), minister of state for communications Devusinh Chauhan said in a written reply to a question in Rajya Sabha on Friday.
Chauhan said that since inception, the total loss of BSNL is Rs 57,671 crores while that of MTNL is Rs 14,989 crores, as of March 31, 2022.
“The reasons for the losses of BSNL and MTNL are high employee cost over the years, debt burden, stiff competition in the market, and lack of 4G services (except on a limited basis in certain areas),” the minister said in the reply.
He added that the Centre in October 2019 approved a revival plan for BSNL and MTNL which inter-alia approved the reduction in employee costs through a Voluntary Retirement Scheme (VRS), debt restructuring by raising of sovereign guarantee bonds, administrative allotment of spectrum for 4G services through capital infusion, monetisation of core and non-core assets and in-principle approval of the merger of BSNL and MTNL.
“As a result of these, BSNL and MTNL have become EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation) positive since the financial year 2020-21,” Chauhan said.
The merger of MTNL with BSNL, however, has been put on the backburner due to the high debt of the former telecom PSU.
The Centre in July 2022 approved another revival package for BSNL amounting to Rs 1.64 lakh crores, with a focus on infusing fresh capital for upgrading BSNL services, allocating spectrum, de-stressing its balance sheet, and augmenting its fibre network by merging Bharat Broadband Nigam Limited (BBNL) with BSNL.
“With the implementation of these measures, BSNL is expected to turn around and become a profit-earning entity,” Chauhan said.
The minister mentioned that BSNL and MTNL have been playing a crucial role along with private telecom players in the development of the telecom infrastructure and expansion of telecom services.
“BSNL and MTNL are important for implementing citizen-centric schemes of the Government of India, especially in the rural and remote un-covered areas,” he said.
BSNL has provided 24,58,827 FTTH connections as on September 30, 2022, he added.
“Further, in line with Atmanirbhar initiative of the Government, BSNL was directed to deploy Indian 4G stack. BSNL has floated the tender in October 2022 for its requirement of 1 lakh 4G sites,” the minister said.
Union minister of communications Ashwini Vaishnaw at an industry event recently said that BSNL’s 4G technology will be upgraded to 5G in five to seven months and rolled out across the telco’s 1.35 lakh towers.
In late November, Tata Consultancy Services (TCS) and state-run ITI Limited submitted their bids for the roll out of BSNL’s commercial fourth-generation or 4G network.
However, Bengaluru-based ITI proposed to use TCS-led telecom equipment, following the proof-of-concept conducted in Ambala and Chandigarh.
TCS, a Tata group company has partnered with the state-controlled Centre for Development of Telematics (C-DoT) that will provide an indigenously developed 4G core solution, upgradable to 5G technology by next year.
ITI has a 20% reservation in the overall deployment of BSNL’s next-generation commercial network.