|Communication Minister RS Prasad|
GOOD news for the employees of Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL). The government has shown seriousness about reviving the two telecom companies in days to come. Minister for Communication and Information Technology, Ravi Shankar Prasad, on July 11 said it is quite serious...to restore the health of the BSNL and MTNL by adopting various measures.
The minister told the Rajya Sabha during Question Hour that government is planning fresh investment of 39,458 crore rupees over five years for the purpose. He said, the two government-owned telcos are faced with declining revenues from loss of market share, increasing expenditure and inability of invest in expansion of communications network.
BSNL's market share of mobile subscriber base has dipped to 10.95 percent, as on May 2014, from 14.87 percent in March, 2009. During the same period, MTNL's market share has come down to 4.83 per cent from 10.87 percent.
The measures are likely to bring some cheers to the once-profitable jewels of the government.
BSNL has been incurring losses since 2009-10. Its profits started dipping after 2004-05, when it had made net gains of Rs 10,183 crore. Its losses stood at Rs 8,198 crore for 2012-13 against Rs 8,851 crore in 2011-12. Likewise, in 2012-13, MTNL recorded a net loss of Rs 5,321.12 crore on annual revenue of Rs 3,428.6 crore. The last time MTNL made a profit was in 2008-09, when it posted a net of Rs 205.9 crore on revenue of Rs 4,496.2 crore.Earlier, during the UPA regime, the department of telecom (DoT) had put a number of issues for GoM for improving condition of MTNL and BSNL. These include a synergy between the two companies, waiver of one-time spectrum charges which amounting to about Rs 10,000 crore, waive off around Rs 980 crore principal amount of notional loan amount outstanding against BSNL among others.