DoT may offer Rs 11,000 crore to revive BSNL

By November 14th, 2014 AT 12:17 PM

The department of telecom (DoT) is planning to offer a soft loan to the tune of Rs 11,000 crore to the loss-making state-run telecom operators Bharat Sanchar Nigam (BSNL) and Mahanagar Telephone Nigam (MTNL). This seems to be a move to address BSNL’s concerns about taking on MTNL’s mammoth debt on its books.

BSNL-logo

As on March 31 (2014), the total debts in the books of BSNL and MTNL stand at Rs 5,948 and Rs 14,210 crore respectively.

The biggest problem for these companies is high employee cost and the legacy of their local fixed line businesses. BSNL has 25 times more employees than Bharti Airtel, the top telecom operator, with half the revenue. MTNL has three and a half times more employees, with barely a tenth of Bharti’s revenue. Note that till 2008, both BSNL and MTNL were among India’s most cash-rich companies, with combined cash and equivalents of nearly Rs 45,000 crore.
BSNL was India’s fifth largest mobile operator, with around 95 million subscribers, less than half of Bharti Airtel’s 200.4 million subscribers at end of March in this year.

Also Read : BSNL awaits green signal for revival, will it really help BSNL ?

Presently, BSNL is facing heat from smaller private sector operators such as Airtel, Vodafone, Aircel and Uninor. MTNL has operations in Mumbai and Delhi only. The operator’s current mobile subscriber base is less than what it had in March 2007. MTNL has become one of the most indebted telecom operators.

Read more on:

17
Leave a Reply

avatar
Photo and Image Files
 
 
 
9 Comment threads
8 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
11 Comment authors
kairavv naharKaranSudhakarFahadAkhil Mohan Recent comment authors
newest oldest most voted
kairavv nahar
kairavv nahar

ya its the time to restructure BSNL but they should use the soft loan in proper and better way

Karan
Karan

Stupid idea. Just fire the old idiots from bsnl. And never recruit any permanent employee. When they have the fear of losing their job everday, then all the stupids will start working.

kairavv nahar
kairavv nahar

I agree

Recent Posts

Tata Sky Watch Service Offers Over 400 Live TV Channels to Subscribers

The Tata Sky self-care application is very popular and is used by almost every Tata Sky subscriber to tweak channel...

Redmi Teases Ultra Premium Gold Clad Special Variant of K20 Pro Hours Ahead of India Launch

The Redmi K20 Pro is going to be one of the biggest launches by Xiaomi this year in India. The...

Hathway Broadband ARPU Dipped to Rs 650 in Q1 FY20

Hathway Cable and Datacom has released its financial report for the quarter ending June 2019. The financial statement of the...