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