The BJP Government led by Narendra Modi today said it will inject Rs 39,458 crore to revive telecom operators BSNL and MTNL over the next five years.
This will be in the form of fresh investments.
“BSNL and MTNL are in financial distress. BSNL and MTNL are faced with declining revenues from loss of market share, increasing expenditure and inability of invest in expansion of communications network,” said IT and telecom Minister Ravi Shankar Prasad in Rajya Sabha during Question Hour.
Mobile subscriber market share of BSNL, which operates in all states excluding Mumbai and Delhi metros, has dipped to 10.95 percent, as on May 2014, from 14.87 percent in March, 2009.
During the same period, market share of MTNL, which operates in Mumbai and Delhi metro circles, dipped to 4.83 percent from 10.87 percent.
Incidentally, private telecom operators such as Bharti Airtel, Vodafone, Idea Cellular, Tata Docomo and Reliance Communications gained significant revenue and market share during the period.
The government said revenue from operations of BSNL and MTNL have dropped by 11.67 percent and 23.87 percent respectively over the past three years. BSNL has been incurring losses for the last five years and it touched Rs 7,085 crore in 2013-14. MTNL has been incurring losses for the last four years with losses touching Rs 5,321 crore in 2012-13.
However, MTNL reported Rs 7,825 crore profit in 2013-14 mainly due to write back of provisions on account of pensionary liabilities and spectrum amortization costs, PTI reported.
Government has taken different measures such as waiver of Rs 1,411 crore government loan to BSNL. It has also accorded financial support to the tune of Rs 6,724.51 crore to BSNL and Rs 4,533.97 crore to MTNL on surrender of Broadband Wireless Access (BWA) spectrum.
