Rs 1.6trn BSNL revival plan

The Union cabinet on Wednesday approved a Rs 1.64 lakh crore (trillion) package to revive BSNL. The telecom PSU has struggled to win customers as Reliance Industries’ telecoms arm Jio and rivals Bharti Airtel and Vodafone Idea have rolled out 4G services and aggressively cut data prices.

Telecom minister Ashwini Vaishnaw said the package has a cash component of Rs 43,964 crore and a non-cash component of Rs 1.2 lakh crore spread over four years. “We are committed to strengthening BSNL,” he said. Funds will be provided to upgrade services, allocate spectrum, de-stress the balance sheet and augment the fiber network by merging Bharat Broadband Nigam Ltd (BBNL) with BSNL.

Analysts said the revival package was too late in the day as private telecom players have garnered significant market share and are bidding for 5G to consolidate their position. The state-owned player is likely to get the 5G spectrum after two years or so as indicated by the minister, which would further erode the subscriber base of the telco.