As per the data shared by the Ministry of Communications and IT, the state run telecom operators, Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL), posted losses for six monthsended September 2014. BSNL posted a loss of Rs 37.85 billion in April-September 2014, while MTNL incurred losses worth Rs 15.67 billion for the same time period.
According to the ministry, the losses have occurred on the account of a decline in revenues and increase in expenditure costs for the two telecom operators. The revenues experienced a decline due to the falling wireline connections, delay in expansion of GSM capacity, poor quality of customer services and a high reduction in income from sources other than their core services. Further, the expenditure of these telecom operators has increased due to the high workforce expenses and increasing repair and maintenance costs.
Further, the ministry added that the despite the increased losses, the proposal to revive BSNL and MTNL through a merger will help them emerge as the leader in the converged telecommunication market. The other measures being taken for their revival include parity treatment of pensionary liabilities of MTNL?s employees who opted for combined service pension with similar employees in BSNL, waiver of government loan to BSNL involving an amount of Rs 14.11 billion and financial support of Rs 4.92 billion to MTNL towards payment of its minimum alternate tax.
