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BSNL Losses Widened Over 2.5 times in Apr-Dec 19

Mihir Gupta by Mihir Gupta
March 6, 2020
in Industries, News
Reading Time: 3 mins read
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BSNL losses - next big brand

Source - India Today

 

  • BSNL recorded a loss of ₹14,904 crores in the last financial year.
  • BSNL losses are just one part of the story of our public sector telecom firm.

Our very own public sector telecom giant and one of the earliest telecom operators in India, BSNL is going through dark times. Aren’t all the telecom giants going through the same phase?

Losses of BSNL widened over 2.5 times to ₹39,089 crores during April-to-December 2019 period. BSNL losses were around ₹14,904 in the 2018-19 financial year. What a deep pitfall BSNL is trapped in?!

“BSNL has informed that its total accumulated loss during the current financial year 2019-20 is ₹ 39,089 crore.” – Sanjay Dhotre (Minister of State for Telecommunications) said in the Rajya Sabha on Thursday.

Last year the government tried to revive the telecom operator by shrinking BSNL losses and approved ₹68,751 crores for loss-making BSNL and MTNL. Union Cabinet also gave thumbs up for the merging of state-owned telecom firms (BSNL & MTNL).

₹68,751 crores come from raising ₹15,000 crores sovereign bonds to meet the immediate capital requirement of both the companies, 4G spectrum allocation amounting to ₹20,140 crores, ₹29,938 crores for VRS covering 50% of their employees and ₹3,674 crores for goods and services tax that will be levied on the allocation of radio waves.

Is It All About Widening of BSNL Losses?

After getting stuck between private telecom operators, BSNL was unable to keep up with the pace of service offering and quality provided by private telecom operators.

Before telecom’s ecosystem witnessed a widening of BSNL losses, it witnessed fierce competition that pulled back our public sector telecom operator.

Then coming of JIO only worsened things for all the existing private and government-run telecom operators. Moving ahead, let’s not forget the amount all the telecom operators need to pay back some ₹92000 crores in the form AGR! BSNL and MTNL are said to repay ₹2099 and ₹2357 crores approximately.

telecom sector in india - Next Big Brand
Debt-ridden industry – The Indian Telecom Industry

Apart from BSNL losses widening day after day, at least 1.6 lakh or 63% of BSNL’s workforce is eligible to opt for VRS and some 77,000 employees have already opted for the scheme.

BSNL - Next Big Brand

Scared from the monopolistic Indian telecom sector, employees of BSNL seems to have lost faith in the company and are now trying to end their stint with BSNL.

Summing Up:

If all the other telecom operators (apart from Airtel and Reliance JIO) are going through dark times then BSNL is going through its darkest times.

Widening up of BSNL losses along with its employees losing faith in the company and opting for VRS makes the company feel like it’s all on its own backed up by the government of India (only).

While all other telecom giants are on their way to pay back their respective debts, BSNL (because it’s backed up by India’s government) still has a chance to be one of the players to survive the disruption Reliance JIO created.

As of now, widening up of BSNL losses along with its employees opting for VRS is the news of the hour and we hope that BSNL comes out of it safely because if it doesn’t we might as well lose that telecom operator which formulated the base for all other telecom giants in India.

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Mihir Gupta

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