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DoT Official says VRS to simplify BSNL and MTNL Operating Expenses

The voluntary retirement scheme (VRS) for the employees of the two state-controlled telecommunications companies Bharat Sanchar Nigam (BSNL) and Mahanagar Telephone Nigam Limited (MTNL), is expected to rationalize its operating expenses (OPEX) and is essential for its revival, an official from the telecommunications department (DoT) said.
VRS scheme to BSNL and MTNL Employees will simplify OPEX

The voluntary retirement scheme (VRS) for Telecom PSU Bharat Sanchar Nigam (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) aims to streamline operating expenses (OPEX) and is also crucial for recovery, the department employ of telecommunications (DoT) said.

"It is likely that the two public sector companies will design VRS in the near future, which will seek to rationalize their ongoing operating costs in reasonable terms for employees and adding the type of scheme will be entirely voluntary in nature," official said.

The official also added that the rationalization of spending would be important for the sustainable relaunch of the BSNL and MTNL and that there was no proposal for reduction or revocation under consideration by the respective Councils or infront of the government.

The NDA government led by Narendra Modi has been under great pressure from the workforce of around 2 lakh by the two state service providers and groups that require approval for the ambitious recovery strategy. BSNL staff major Unions Bharatiya Mazdoor Sangh and Communist unions also accused the government favors the billionaire owner of Reliance Jio, run by Mukesh Ambani, rather than publicly owned telecommunications companies.


In a statement, the opposition leader said 'Prime Minister Shri Narendra Modi promoted the companies of their capitalist friends at the expense of state-owned BSNL and MTNL'.

However, the official, refuting the congressional leader's comments, said that both BSNL and MTNL took loans from banks from time to time, as needed and these loans were provided by letters of patronage and presidential government sanctions.

Department of Statistics reveal that BSNL has borrowed a total of Rs 6,600 crores of banks in 2017-18 and 7,082 in 2018-19 crores, Rs 1,000 crores beyond just March 2019.

MTNL borrowed a total of 3,346 crores from banks in 2017-18 and Rs 3,106 crores in 2018-19.

"There were one or two lost cases of a few days of late payment of salary due to minor cash flow problems," the person quoted above added.

BSNL 1.76 employees for more than two weeks faced the crisis for the first time with the late payment of the February 2019 salary.

The two telecommunications operators have also asked for airwaves to venture into 4G services in order to compete with competitors such as Vodafone, Idea, Bharti Airtel and Reliance Jio, which have already launched the 4G-LTE high-speed commercial model (Long Term Evolution ) Services three years ago.

"The government is rapidly investigating the issue (4G) for a rapid and positive response," the official said.

In March, the department asked the telecommunications regulators to allow the 4G services administrations to administer the two telecommunications companies.

The official also said that the financial pressure on both MTNL and BSNL is due to the year 2010, when a large sum of costs for broadband and 3G wireless spectrum access were forced to pay the government of that time (BWA ).

"This (the payment of the spectrum) has caused serious financial bleeding from these companies that have not yet recovered. Since the financial year 2009-2010, they have suffered net losses," the person added.

It is also expected that the central government to start some of the programs introduced by BSNL Telecom connectivity initiative mega discovered villages, including those in the Northeast.

In the last year, BSNL has installed nearly 18,000 3G network towers as well as upgrading over 10,000 towers from 2G services to 3G network.

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