Quick Take

Right move to revive BSNL, MTNL

| Updated on October 24, 2019

Public sector presence will maintain a semblance of competition, now fast receding, in the telecom space. National security considerations demand a PSU presence

The Centre has taken the right decision to revive Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd. While many have argued that the bailout of the two public sector companies is a waste of taxpayer’s money, there are three reasons why this move will prove to be strategically important in the long-term.

The PSU offers a viable counterbalance to have some semblance of competition. The highly leveraged balance sheets of private operators are already forcing them to slow down the rollout of next-generation data networks to rural and economically unviable areas in the country. Having a strong PSU will not only prevent private players from increasing tariffs as an easy means to wriggle out of the financial stress but also ensure that even rural consumers are catered too. Second, in times of natural calamity and manmade disasters, BSNL has often emerged as the only operator which has been able to quickly revive communication networks in the affected areas. Third, when it comes to the national security, communication network is a key element. BSNL plays an important role in connecting strategic establishments across the country. This function cannot be given to any private operator.

The Centre should now move quickly to implement the revival package. The merger of BSNL and MTNL has been under discussion since 2002. Similarly, the proposal to sell land assets and monetise the tower infrastructure was first mooted in 2011. But so far these proposals have only remained on paper. BSNL was also given a raw deal when it comes to 4G spectrum, when the Centre allocated frequency bands which proved to be unviable.

A lack of political will and weak management has throttled the telecom companies’ progress over the years. There should not be any further delays in implementing these proposals. The employees of the telecom companies should also cooperate and not come in the way of this progressive move. Those who are not aligned with the requirements of a new BSNL should take voluntary retirement. It is high time BSNL is allowed to breathe and unleash its capabilities as India moves ahead on the information highway.

Published on October 24, 2019

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