- The government will raise Rs 15,000 crore from sovereign bonds
- Revival Package will also include monetisation of assets
- Nearly 92,000 employees from BSNL and MTNL have opted for VRS scheme
BSNL and MTNL have been facing financial crisis for a long time now. In April-December 2019, BSNL reported a loss of Rs 39,000 crore. The trouble seems to be increasing for the government-owned telecom companies as their workers have been protesting for default in salaries. Various officials have raised their concerns regarding the on-going strikes and protests by employees. However, Sanjay Dhotre addressed the concerned officials in Rajya Sabha and marked that the government will not sell out the telecom companies. Instead, the government will be structuring a revival package for the loss-making companies. Notably, the Cabinet announced a revival package for BSNL and MTNL last year and even VRS has been completed as part of the same.
Government Has Approved Revival Package for BSNL and MTNL
In order to revive the loss-making telecom operators, the government has already rolled out a four-way revival plan which will ensure the viability of the loss-making operators. Also, the revival package will boost up the morale of the employees who have been indulged in various strikes to get their salaries on time.
As of the revival package, the government will approximately raise Rs 15,000 crore by issuing sovereign bonds. Not only this, but the government is also planning to monetise assets worth Rs 38,000 crore in the period of four years. To make sure BSNL and MTNL retain in the market, the government will also allocate 4G spectrum, which would be done with base prices of 2016. BSNL is promising to launch 4G services very soon.
VRS Scheme Will Revive BSNL and MTNL
As per the reports, it is expected that the loss-making companies will almost save Rs 8,800 crore from the VRS scheme. Nearly, 78,569 employees of BSNL and 14,000 employees from MTNL have opted for Voluntary Retirement Scheme. It is also expected that the reduction in the number of working employees will reduce the financial burden from the companies as wage bill will be reduced drastically, which will result in financial aid.
Currently, the wage bill stands at Rs 14,000 crore, which might be reduced to approximately Rs 7,000 crore. It Is predicted that the four-way revival plan made by the government will help the loss-making companies to get back in the telecom market. Yet, the government has just rolled out the VRS scheme. Also, the encashment of assets is moving at a slow pace.
Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.