Cabinet clears ₹89,047 cr revival package for BSNL for 4G & 5G spectrum
With the third package, the total government assistance to the No 4 carrier in the country has risen to ₹3.22 trillion since 2019
PremiumNEW DELHI : The Cabinet Committee on Economic Affairs cleared a third revival package of ₹89,047 crore for state-run carrier Bharat Sanchar Nigam Limited which will be used for acquiring 4G and 5G airwaves from the government such that it can begin offering 4G services within months and 5G services by 2024 across India.
With the third package, the total government assistance to the No 4 carrier in the country has risen to ₹3.22 trillion since 2019. The government had approved a ₹69,000 crore package in 2019 to revive and stabalise beleaguered BSNL and its smaller counterpart MTNL. In July 2022, the government cleared another ₹1.69 trillion to improve the balance sheet of BSNL and increase its capex.
The ₹89,047 crore is meant for allocation of 5G spectrum in the 700 Mhz, 3300 Mhz, 26 Ghz and 2500 Mhz bands which can be used for 4G as well, through equity infusion. The airwaves will be given at auction determined prices plus goods and services tax, which amounts to ₹46,338 crore, Rs 26,184 crore, Rs 6564 crore and Rs 9428 crore.
“Time has come that BSNL should be in the leagues of major players in the country, and provide services where others do not provide," said communications and IT minister Ashwini Vaishnaw. He noted that the carrier will have to provide good services in order to compete with the market on its own. Indian carriers Airtel and Reliance Jio have already begun offering 5G services across 200,000 sites in the country.
“With this spectrum allotment, BSNL will be able to provide pan India 4G, 5G services, fixed wireless access services, captive non-public networks and coverage in rural and uncovered villages," he added. BSNL has already placed a purchase order of equipment for 1 lakh 4G sites to TCS-CDoT and ITI, for about ₹19,000 crore.
Vaishnaw said that BSNL will become debt free in three years time and that the government will not infuse any further equity or provide any additional government-backed debt.
BSNL chairman and managing director PK Purwar said that the debt reduction will take place through internal accruals. Debt has been reduced by ₹10,000 crore by FY23-end to Rs 22,289 crore. He added that within six months the carrier will revamp its IT, HR and technology platforms to make them consumer friendly in order to compete in the market.
“4G and 5G installations have been done in 200 sites, and those will be tested live for three months, after which there will be rapid rollout," the minister added. He also noted that 3G will be shut down, as has been done by other private players.
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