DoT seeks Niti Aayog’s views on BSNL-MTNL 4G spectrum proposals

financial chronicle

Business, Companies

MTNL has requested the government to grant it 4G spectrum in lieu of equity worth around Rs 6,500-7,000 crore.

MT¬NL, the other state-run te¬lecom firm, reported a loss of Rs 2,971 crore in FY18.

New Delhi: The department of telecom (DoT) has sought government think ta­nk Niti Aayog’s views on the 4G spectrum allocation proposals of it PSUs — BSNL and MTNL — th­at can cost the exchequer about Rs 13,000 crore.

The DoT proposal ba­s­ed on the individual board DPRs (detailed projects re­p­orts) of BSNL and MT­NL — both declared incipient sick PSUs by the dep­a­rtment of public enterp­r­ises — seeks to allocate 4G spectrum to them to ma­tch private competition and be in the fray amid cut-throat competition. Go­­v­ernment owned entities do not participate in auction but they match the highest bid for the band they seek to buy.

An internal DoT note said a draft cabinet note after taking approval of the minister has been sent to various ministries and the Niti Aayog for inter-ministerial consultations.

Usually ministry views are sought while preparing a cabinet note but to broadbase the consultations, the DoT has also wr­i­tten to the consulting arm of the government on this. If it supports the DoT proposal, rhe Niti Aayog’s entry at the consultation stage, could mean it will suggest some revival mea­s­u­res to these two loss-making PSUs and how can they utilise funds.

The Aayog has made its presence felt in some of the previous major gover­nm­ent schemes like MSP hike for farmers where it had suggested three worka­ble models and in the Ay­u­shman Bharat healthca­re, in which it had recomm­­ended a new model to in­volve private companies in providing healthcare se­r­­vices as part of the sch­e­me.

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Surprisingly, the think ta­nk has not given any roadmap so far for BSNL, which reported a loss of Rs 4,786 crore in 2016-17 and cut down its loss by ju­st Rs 1 crore in 2017-18 to Rs 4,785 crore while its inc­o­me stood at Rs 32,411 cr­ore (FY16), Rs 31,533 crore (FY17) and Rs 27,818 crore (FY18) . MT­NL, the other state-run te­lecom firm, reported a loss of Rs 2,971 crore in FY18. This was against a similar amount in FY17 and Rs 2,006 crore in FY16.

For MTNL, the Aayog, in May this year, suggested hiving off its towers into a separate company and sel­l­i­ng it off. But it did not pr­o­pose any outright stake sale due to presence of hu­ge premium real estates.

While BSNL has sou­ght Rs 6,652 crore as equity infusion from the gover­n­ment to fund its spect­r­um purchase worth about Rs 13,885 crore, MTNL has requested the government to grant it 4G spectrum in lieu of equity worth around Rs 6,500-7,000 crore and extend its mobile licence which is expiring in 2019 till 2021.

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