BSNL and MTNL along with private telecom players play a key role in developing telecom infrastructure and expanding telecom services. BSNL and MTNL are important for implementing citizen oriented schemes of Government of India especially in rural and remote unserved areas. BSNL has provided 24,58,827 FTTH connections as on 30.09.2022.
Further, in line with the government’s Atma-nirbhar initiative, BSNL has been directed to deploy India’s 4G stack. BSNL has floated a tender in October 2022 for the requirement of 1,000,000 4G seats. Since inception, total net loss of BSNL is Rs. 57,671 crore while MTNL’s Rs. 14,989 million as of 03/31/2022.
Reasons behind BSNL and MTNL’s losses are high employee costs over the years, debt burden, tough competition in the market and lack of 4G services (except for a limited number in certain areas). On 23/10/2019 Government of India approved recovery plan for BSNL and MTNL.
Among others, it approved reduction of staff costs through Voluntary Retirement Scheme (VRS), debt restructuring by raising government guarantee bonds, administrative allocation 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, BSNL and MTNL have become EBITDA (earnings before interest, taxes, depreciation and amortization) positive from the financial year 2020-21. Further, to transform BSNL into a viable public sector undertaking, the Government has approved a revival package of Rs.1.64 lakh crore for BSNL on 27.07.2022. The revival measures are aimed at infusing fresh capital to upgrade BSNL’s services, allocate spectrum, reduce the burden on its balance sheet and expand its optical 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 profitable entity. This information was given today by Minister of State for Communications Shri Devusinh Chauhan in a written reply to a question in the Rajya Sabha.