Vendors may abandon BSNL network due to nonpayment; 2G, 3G services to hit

Telecom gear suppliers may pullback network operations and maintenance services being provided to cash-strapped Bharat Sanchar Nigam Limited (BSNL), due to nonpayment of dues, according to industry sources.

“There is tremendous pressure on us. We have been asked to shutdown services we offer to BSNL by the top management executives in the headquarters due to continued nonpayment of our outstanding amount,” an industry source said.

Nokia has so far not been able to recover Rs 800 crore worth of dues from the state-controlled telecom service provider.

“Not only the BSNL, but we have also been writing to the top government functionaries for the last few months, but the situation remained unchanged,” the source added.

In a letter to the Department of Telecommunications (DoT) in March this year, the Finnish telecom equipment company said that payment had been overdue for more than three months, and has also warned that it was “essential to ensure service continuity” to BSNL.

The company has also added in the letter that it was facing challenges in maintaining cash flow including Opex or operating spend, and it had led the fourth-largest telco to expand its wireless network, and enabled new technologies.

The development has though already triggered the multinational equipment vendor to reduce its focus and workforce aligned with the state-run telecom carrier.
Nokia chose not to respond to ETTelecom’s queries.

Indo–Singaporean Rajeev Suri-headed Nokia maintains BSNL’s 2G and 3G infrastructure, and in 2017, it was tasked to replace telco’s 2G cell sites with modern sites to facilitate 3G services.

BSNL serves nearly 115 million mobile telephony subscribers in India.

Besides Nokia, Chinese ZTE, American Tower Corporation, UTStarcom and Fiberhome are among multinational companies that have demanding their dues to be released from the state-owned telecom carrier.

“In a scenario of limited resources, one has to prioritise things. Clearing dues is a continuous process,” BSNL chairman PK Purwar said.

On asking about Nokia’s top management’s concern involving continuity of network services, he said that not only BSNL but all service operators are facing certain financial challenges in the telecom marketplace currently.

“BSNL has always honoured its liabilities and has already taken certain steps, and some vendors are in the process to receive disbursements,” Purwar added.

The telco has so far cleared Rs 1,100 crore worth of vendor dues this week.

BSNL’s Purwar also expects the telecom department to clear the credit worth Rs 3,300 crore within the next few days which was though approved back in March this year.

The state-driven carrier has also entered into Industry 4.0 partnership in the areas of automation, cloud computing, and Internet of Things (IoT) as well as inked a memorandum of understanding on the fifth-generation (5G) technology for knowledge sharing with Nokia.