Indian Government Union Minister said No plans to shut-down BSNL and MTNL


Union Minister Dhotre announced to media that the government has no plans to shut down BSNL or MTNL.

Union Minister Sanjay Dhotre said in Lok Sabha that the government has no plans for now to shut down public sector telecommunications companies such as BSNL and MTNL. This is a sigh of relief for the users of these services as they were part of the loss generators and some predicted the departure of Bhart Sanchar Nigam Limited. 

No plans to shut-down BSNL and MTNL

The minister shared that BSNL's losses had increased from Rs 14,904 crore to Rs 15,500 crore, and MTNL NSE increased its losses by 2.7%, from Rs 3,398 to Rs 3,811 crore. These data refer to the periods 2018-19 and 2019-2020.

According to the minister's written response, he said the government has no plans to shut down BSNL and MTNL. To help with its troubles, the government announced a revival package of around Rs 69,000 crore in October 2019.

What does the Revival package do?

The recovery plan that is intended to help the loss of telecommunications companies includes a reduction in costs related to employees using a voluntary retirement scheme (VRS) for employees aged 50 and over, with other steps between which the administrative assignment of various spectra for 4G services with financing, through budget allocation, as well as debt restructuring through the collection of sovereign bonds.

This package also includes monetizing certain assets in order to generate resources for debt collection, expenses and other requirements and to assist in the approval of the BSNL and MTNL merger.

Speaking about the findings of this during a separate question, Dhotre said that approximately 78,569 employees and 14,387 MTNL employees have opted for VRS. which, together, helped reduce wage spending by 50% and 75% for BSNL and MTNL, respectively. In addition, the government has allocated Rs 16,206 crore to meet the final funding requirement for ex gratia in VRS. In addition, the government has incurred an expenditure of around Rs 1,952 crore as an incremental pension until 21 December 2020.

As part of such a relaunch package, the government had approved resource monetization plans for both BSNL and MTNL in 2020. Furthermore, BSNL had informed the government that it could generate around Rs 241 crore from monetization of assets / land when the awakening package was announced.

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