The Indian government on Wednesday approved an Rs 890.47 billion ($10.79 billion) revival package to revive the state-run Bharat Sanchar Nigam Ltd (BSNL) and to help the loss making telecom operator deploy 4G and 5G services in a market dominated by private players, which primarily includes Reliance Industries Limited’s Jio and Bharti Enterprises’ Airtel.
“The authorized capital of BSNL will be increased from Rs 1,50,000 crore to Rs 2,10,000 crore,” the government said in a statement today.
“With this revival package, BSNL will emerge as a stable telecom service provider focused on providing connectivity to remotest parts of India,” the Indian government added.
As a part of the revival plan, the government also allotted fresh telecom spectrum to the company with a specific set of directives. These directives are:
— Providing pan India 4G and 5G services.
— Providing 4G coverage in rural and uncovered villages under various connectivity projects.
— Providing Fixed Wireless Access (FWA) services for high-speed internet.
— Providing services/spectrum for Captive Non-Public Network (CNPN).
Here are all the details pertaining to the spectrum allottment:
|Band||Spectrum allotted||Budgetary support|
|700 MHz||10 MHz paired in 22 LSAs||Rs 46,338.60 Cr|
|3300 MHz||70 MHz in 22 LSAs||Rs 26,184.20 Cr|
|26 GHz||800 MHz in 21 LSAs and 650 MHz in 1 LSA||Rs 6,564.93 Cr|
|2500 MHz||20 MHz in 6 LSAs and 10 MHz in 2 LSAs||Rs 9,428.20 Cr|
|Miscellaneous items||Rs 531.89 Cr|
|Total||Rs 89,047.82 Cr|
It is worth noting that the development comes days after BSNL partnered with Tata Consultancy Services (TCS) to help deploy 4G network across the country at a time when larger rivals were rolling out next-generation 5G network.
“From the government’s standpoint, BSNL is not just an investment to ensure competition, it is also a sandbox for the indigenisation initiatives that the government has as far as telecom networks are concerned,” said Vivekanand Subbaraman, a telecom analyst at Ambit Capital.
“The investment will help with some of the infrastructure that needs to come up for 5G and for a credible third player to be present in the market.”
BSNL, grappling with poor infrastructure, has been posting losses for the past 12 years. The losses narrowed to 69.82 billion rupees in the year ended March 2022 from 74.41 billion rupees a year ago.
The company has also been struggling to win customers in the face of intense price competition from Reliance Industries-owned Reliance Jio Infocomm, Bharti Airtel and Vodafone Idea.
The telecom market in India was upended by Jio’s launch in 2016, when it offered free calls and cut-price data plans, eroding the profit and revenue of rivals and leading to consolidation.
— With Reuters inputs.
Author Name | Shweta Ganjoo