Government Delays BSNL and MTNL Merger Owing to Financial Reasons

Follow Us

Government Delays BSNL and MTNL Merger

The merger between state-run telcos BSNL and MTNL is delayed owing to financial reasons. Ravi Shankar Prasad, the minister of Electronics and Information Technology, said the decision has been taken considering several factors. As we already know, the financial situation of both BSNL and MTNL is not in a great position. MTNL, on the other hand, is riddled with high debt at the moment. The minister also said that the government is undertaking a close look at the service integration between BSNL and MTNL. To recall, the Union Cabinet approved the merger plan of BSNL and MTNL back in 2019, alongside providing a major revival plan to the former.




BSNL and MTNL Merger Plan Deferred For Now

In a written reply to Lok Sabha, Ravi Shankar Prasad said the government would undertake "close cooperation and service integration between BSNL and MTNL." As of this writing, MTNL's debt stands at around Rs 20,000 crore.

This decision from the government will not surprise many because the telcos are struggling to compete in the industry. Private telecom operators are investing heavily in 4G services, but both BSNL and MTNL are still offering 3G services to the customers.

At the end of 2019, the Union Cabinet approved a revival package to BSNL and gave the nod to merge two government-owned PSUs. The telcos benefited from this revival package as they were able to cut monthly employee wages with a voluntary retirement scheme (VRS). Overall, the revival plan of the telco was estimated to cost around Rs 70,000 crore.

If everything goes as planned, MTNL will act as a subsidiary of BSNL post the merger, but the confirmation is here that the merger plan is deferred indefinitely. Both the telcos were also expected 4G spectrum from the DoT as part of this revival plan itself.

In January this year, a six-member Group of Ministers (GoM) reportedly called the merger would not have a positive impact on any party. They said the merger wouldn't be 'beneficial' or 'feasible' as the telcos are struggling to have positive cash flow.

Reported By

Managing Editor

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.

Recent Comments

shivraj :

My New Vi Prepaid Sim which i bought from Kolkata Circle is coming to Mumbai tomorrow the vi store employee…

Vodafone Idea Unlimited Data Plans Come to Kolkata, Maharashtra &…

rahul_yadav :

If VoLTE isn’t working, first raise a complaint in the BSNL Selfcare App. If it still doesn’t work visit your…

BSNL Places Additional Orders to TCS for 4G Sites

Rohit :

Jab sote jaagte airtel ko hi dekhte ho Vi wale to q nahi usko hi apna Saiyan bana lete ho…

Vodafone Idea Follows Airtel: Introduces Rs 299 Per Add-On Feature…

Shivraj Roy :

Phoenix bhai inko bas 512kbps ka plans wapis lana hai bas

Airtel's MD and Vice Chairman Talks About Tariff Restructure in…

Sujata :

5 more years it''ll take then.

BSNL Places Additional Orders to TCS for 4G Sites

Load More
Subscribe
Notify of
guest
6 Comments
newest
oldest most voted
Inline Feedbacks
View all comments