Devusinh Chauhan justifies BSNL-MTNL losses

Minister of state for communications, Devusinh Chauhan in a written reply to a question in Rajya Sabha says, 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.

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. BSNL has provided 24,58,827 FTTH connections as of 30.09.2022. Further, in line with Atma-nirbhar initiative of the Government, BSNL was directed to deploy the Indian 4G stack. BSNL floated the tender in October 2022 for its requirement of 1 lakh 4G sites.

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). On 23.10.2019, the Government of India approved the revival plan for BSNL and MTNL. It inter-alia approved the reduction in employee costs through the Voluntary Retirement Scheme (VRS), debt restructuring by raising of sovereign guarantee bonds, administrative allotment of spectrum for 4G services through capital infusion, monetization 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 Amortization) positive since the financial year 2020-21.

Further, to transform BSNL into a viable Public Sector Undertaking, the Government approved a revival package for BSNL amounting to Rs 1.64 lakhs crores, on 27.07.2022. The revival measures focus on infusing fresh capital for upgrading BSNL services, allocating spectrum, de-stressing its balance sheet, and augmenting its fiber 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.

CT Bureau