Union Cabinet Approves Rs 89,000-Crore Revival Package For BSNL

BSNL Revival Plan: The package will be utilised for enhancing BSNL's 4G and 5G services. The government believes that a PSU in telecom should flourish because of its strategic importance

The central government in July 2022 announced a revival package for BSNL to provide 4G and 5G services to turn the telecom PSUs into a more profitable organisation. ( Image Source :Getty )

The Union Cabinet on Wednesday approved the Rs 89,000 crore revival package for Bharat Sanchar Nigam Limited (BSNL), according to a release by the government. The package will be utilised for enhancing BSNL's 4G and 5G services. It includes allotment of 4G and 5G spectrum for the BSNL through equity infusion. The release said that the authorised capital of BSNL will be increased from Rs 1 lakh 50 thousand crore to Rs 2 lakh 10 thousand crore. The government believes that a PSU in telecom should flourish because of its strategic importance, the sources said.

This is not the first revival package for BSNL announced by the government. The Centre in July 2022 announced a revival package for BSNL to provide 4G and 5G services to turn the telecom PSUs into a more profitable organisation. The package focused on advancement of services and its quality, distress BSNL's balance sheet, and expanding BSNL's optical fibre network.

In May, BSNL issued advanced purchase orders worth Rs 15,000 crore to a TCS-led consortium. ITI Limited also received a contract for supplying 4G telecom gears worth Rs 3,889 crore.

"The total order is of over Rs 19,000 crore," a senior government official was quoted in the report by news agency PTI. TCS and a consortium, including state-run telecom technology development organisation C-DoT, will deploy around 1,00,000 4G sites for BSNL.

The Centre also merged Bharat Broadband Network Limited (BBNL) with BSNL. With this merger, BSNL got an additional 5.67 lakh km of optical fibre laid across 1.85 lakh village panchayats through the Universal Service Obligation Fund (USOF).

It was earlier reported that the government was contemplating the closure of Mahanagar Telephone Nigam Ltd (MTNL), a debt-ridden telecommunications firm. As a result, there are plans to transfer the staff and operations of MTNL to BSNL, abandoning the previous proposal of merging the two state-owned telecom companies. The decision to consider closure stems from the fact that MTNL has been facing continuous losses and is burdened with a substantial amount of debt. 

 In April this year, the government asked BSNL and MTNL to identify a list of assets that can be monetised. According to a a news report the Department of Telecommunications (DoT) has asked the two telcos to identify core and non-core assets with a value of up to Rs 10 crore for monetisation. The report citing people aware of the matter also said that BSNL is likely to identify at least 10 such properties in this range in each circle.