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Cabinet approves Rs 89,047 cr for 4G, 5G spectrum allocation to BSNL

DECCAN CHRONICLE | Madhusudan Sahoo

Published on: June 7, 2023 | Updated on: June 7, 2023

The authorised capital of BSNL will be increased from Rs 1.5 lakh crore to Rs 2.1 lakh crore. (DC File Image)

NEW DELHI: As part of its revival strategy, the Centre has approved a comprehensive package worth over Rs 89,000 crore for Bharat Sanchar Nigam Ltd (BSNL), the state-run telecom operator. The government aims to revive BSNL through various measures, including the allocation of 4G/5G spectrum by means of equity infusion. Additionally, the authorised capital of BSNL will be increased from Rs 1.5 lakh crore to Rs 2.1 lakh crore.

After a Cabinet meeting, Union minister Piyush Goyal informed the media that BSNL already has 4G coverage in many parts of the country and is on the verge of achieving nationwide coverage. Regarding 5G, the concerned minister will provide further information. With the implementation of this revival package, BSNL is expected to become a stable telecom service provider with a focus on delivering connectivity to remote areas of India, stated the minister.

This government initiative comes at a time when BSNL has been grappling with inadequate infrastructure and has been seeking financial assistance from the government for an extended period. BSNL has faced intense competition from private telecom giants such as Reliance Jio, Bharti Airtel, and Vodafone Idea, as its competitors have already launched 4G services at affordable prices for voice calls and data.

The government, in a statement, announced that the Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the third revival package for BSNL, amounting to Rs 89,047 crore. This package includes the allocation of 4G/5G spectrum to BSNL through equity infusion, and it will also result in an increase in BSNL's authorised capital from Rs 1,50,000 crore to Rs 2,10,000 crore.

This development follows the signing of a partnership agreement between BSNL and Tata Consultancy Services (TCS) for the nationwide deployment of a 4G network. BSNL's push for 4G is expected to provide strong competition to its peers who are currently in the process of rolling out 5G services across India. The statement further emphasised that this revival package will enable BSNL to establish itself as a reliable telecom service provider with a focus on connectivity in the most remote areas of India.

Previously, the government had approved two revival packages for BSNL/MTNL in 2019 and 2022, with investments of over Rs 69,000 crore and Rs 1.64 lakh crore, respectively. These packages brought stability to BSNL/MTNL and provided financial support for capital expenditure, viability gap funding for rural landlines, balance sheet restructuring, settlement of AGR dues, and the merger of BBNL with BSNL. As a result, BSNL has been generating operating profits since FY2021-22, and its total debt has decreased from Rs 32,944 crore to Rs 22,289 crore.