Rajan Gandhi
Recent incidents on social media and in news have made people think what is wrong with BSNL, one lady employee of BSNL crying for help on social media as BSNL failed to give timely salaries to its employees, protest demonstration of transporters at Bahu Plaza for pending payments since December last year and in circulation news of government planning closure of BSNL, once a Navratan company – pride of India, has been reduced to such a level that it’s on the verge of closure right now. But all this has not happened in one day, for answer to this one has to go back to Vajpayee era when profitable BSNL was converted to corporation. Government assured to take necessary measures to avoid any loss to BSNL, but immediately broke that assurance by limiting the compensation to BSNL for its losses on rural landlines only for a few years. Subsequently the UPA Government added its share of follies in increasing the losses by first going in for expansion of landline equipment when mobiles were already launched, further delaying the procurement of GSM equipment for expansion and by the time BSNL got itself ready for 3G pan India 4G was already there for which BSNL has no spectrum. The spectrum policies of Vajpayee and Manmohan Singh Governments with further continuation of the same by Modi Government are another main reason for the losses to BSNL. The loss has occurred mainly due to reduction in revenue and increase in expenditure. Revenue has gone down due to drastic reduction in tariff, fierce competition as well as decline in fixed wire line connection due to preference of the subscribers for mobile.
BSNL spends around ten thousand crores every year on employee’s salaries. The financial position of the company today has reached a stage where the revenues generated are quite insufficient to meet wage bill, let alone incurring expenditure on growth. The electricity, labour, vendor payments etc are delayed for months together. The expansion works and future growth plans are virtually stalled. Non-maintenance of the network due to shortage of funds is further deteriorating the services which is resulting in continuing decline in revenues. All these things in addition to under trained ground staff, crores of useless expenditure on microwave spectrum, alternative fibre optic arrangements with Power Grid Corporation, outdated equipment with no funds for maintainence/expansion and insensitive approach of respective governments have just reduced BSNL from riches to rags. Employee base of BSNL in the country is 1.76 lakh and the number of MTNL employees is close to 22,000. During UPA2 Communications Minister Kapil Sibal was keen to show that the CAG was wrong in estimating the 2G spectrum losses under Raja at Rs 1.76 lakh crore than in fixing what’s wrong in the sector. BSNL right now is controlled by ITS bureaucrats who have nothing to lose as they are getting their salaries from DoT (as per 7th pay commission) and any closure or loss of BSNL does not affect them as such but survival of BSNL under such servile management, which cannot rise above the interests of the lords (ministers and babus) is next to impossible. Can anyone in BSNL top brass explain why Next Gen exchanges are being purchased for landline and deployed when landline phones are no more in demand, how for a load capacity of 200KVA, 500KVA generating set has been purchased, when central government doesn’t support BSNL why WiMax technology was introduced for rural India to serve khidmat centres, how come both WLL and mobiles were introduced around same time by BSNL. The BSNL Management has planned to outsource the maintenance of BSNLs towers for exorbitant rates, for which huge amount has to be paid annually. Thus, the issue fundamentally boils down to the induction of the rarest of rare talent on the board, total autonomy to take swift on spot decisions. Though BSNL struggles to dig even 500 meters of road for repairs, private vendors virtually dig whole city and no one objects as BSNL don’t have any funds to grease the palms of corrupt administration. Two reasons are likely to be at the heart of this decline: declining tariffs and policy uncertainties. Last 3 years, 2014-15, 2015-16 and 2016-17, BSNL performed in an outstanding manner and increased the operational profit, year after year till the entry of Reliance Jio. Government and TRAI allowed policy violations and predatory pricing by Reliance Jio which crippled the industry even though BSNL could withstand in comparison to private operators in an exceptional manner. All other operators, despite massive decline in their revenues, including R-Jio, are able to stay in the market only with the support of public financial institutions and as such have a market liability of 6 lakhs Crores, even crossing the ceiling set by RBI for Telecom sector where as BSNL is having outstanding of just 15,000 Crores. Despite BSNL having huge vacant land at prime locations scattered in 15,000 land parcels valuing itself more than 3 lakh Crore, an effective monetization of the vacant land proposal to lease out to PSUs, Banks etc was submitted in May, 2018 for the approval of DoT. Huge amount of revenue to the tune of 1000 Cr to 5000 Cr is expected from this business itself. However, DoT is not taking any action on this proposal. All other private operators were adequately compensated to the tune of thousands of crores through unbelievable policy concessions but BSNL is even denied Letter of Comfort for availing Bank Loans, that also continuously for two years, 2017-18 and 2018-19.
Now what are the options available to safeguard 2 lakh employees, first option is to merge MTNL and BSNL after their network infrastructure and land assets are spun off into separate companies create three companies, one infrastructure company, one land company and the third will be the merged telecom services entity. Then infuse cash by means of refunding them the fees collected for the broadband wireless access (BWA) spectrum they were given in 2008 but refunding Rs 11,259 crore to the duo is hardly going to help them when their combined losses are many folds than this. Merging the two is no recipe for revival either, when the problem is overstaffing and lack of managerial autonomy. In the case of BSNL and MTNL, the government pretended to favour them by announcing that they would get BWA spectrum in all circles even without bidding at the auction prices but taking money as per the bidding pattern at that time. This was pricey benevolence, since getting high-priced spectrum without any clear plan to use it commercially effectively sank both of them. It is said that if you dislike someone but still want to give him a gift for an outward show of love, gift him an elephant. The costs of maintaining the pachyderm will kill him. That’s the case with both BSNL-MTNL, as they were crippled by ministerial meddling masquerading as benevolence. The only remedy for them is autonomy. Trifurcation under the same dispensation is tantamount to slow poisoning.
Second option is giving a bailout package. This not only will allow BSNL to pay salaries to its employees, but it can also get the capital to reduce operating expenses and invest in 4G technology. As per proposal this bailout package will consist of a voluntary retirement package. This will reduce operating costs of BSNL. The balance amount will be given as equity for the allocation of 4G spectrum. The Ministry is also considering how to use properties of BSNL spread across the country. But DoT is putting all the hurdles in the revival of BSNL and settlement of the issues, inspite of the fact that, at the time of formation of BSNL, Government declared that the financial viability of BSNL will be fully taken care of, better career prospects for the employees and guaranteed pensioner benefits to all. Non filling of BSNL Director Posts is deliberate attempt of the Government to destabilize BSNL. The Niti Aayog and Finance Ministry is vehemently opposing any proposal for revival of BSNL like 4G spectrum allotment. The non settlement of HR issues like 3rd PRC is also part of the same game plan to create industrial unrest in the company and further weaken BSNL to facilitate other operators as alleged by BSNL employees union. Even Pension Revision is denied by the Govt.
Despite all these rumblings BSNL stood with GoI during Kashmir floods, Kargil war, catering Leh/Ladakh like territory , tsunami in South India and what not but right now except one or two circles across India , every circle of BSNL is in loss. In our J & K BSNL has a mobile base of around 13 lakh users and landline base of 1.5 lakhs, including prestigious Broadband, providing services in the most hostile terrain. Despite a corporation BSNL has been used by government as government department, applying every government rule of law on BSNL be it penalty on form rejections, penalty on excess radiation from towers resulting in call drop and more towers for same area as compared to private operators and many more but giving exceptional rebates and concessions to private operators. GoI is neither giving them complete autonomy nor providing them any financial help. Right now in the age of 4G, BSNL is selling 3G and still surviving but how long is a question nobody wants to answer. Will GoI provide level playing field to BSNL or suffocate it to untimely death is the only question to be answered right now, till then it’s just wait and watch helplessly for BSNL employees from the sidelines.
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