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BSNL Says It Has ‘Not Received’ Direction To Put Capex Plans On Hold

The government has clarified there is no proposal to close BSNL and MTNL, and that a revival plan is in the works.

Like other telecom companies in India, BSNL too has been facing stress since Reliance Jio entered the market. (Photographer: Dhiraj Singh/Bloomberg)
Like other telecom companies in India, BSNL too has been facing stress since Reliance Jio entered the market. (Photographer: Dhiraj Singh/Bloomberg)

Bharat Sanchar Nigam Ltd. on Thursday denied having received any direction from the telecom department to put on hold all of its capital expenditure plans.

In a June 12 order, BSNL’s finance department directed all its circle heads to take prior approval of the corporate officer in Delhi before floating any new tenders for capex, sources had said on June 25.

BSNL, however, said it has not received any such direction from the department.

“The above reference to DoT is not based on facts and is incorrect. No such directions were received from the finance wing of DoT by Finance Department of BSNL on this subject,” the state-owned telecom firm said Thursday.

Like other telecom companies in India, BSNL too has been facing stress since Reliance Jio Infocomm Ltd. entered the market.

While promoters of private telecom operators, including Reliance Jio, are investing thousand of crores, BSNL is awaiting government decision on allotment of 4G spectrum to compete in the market.

On Wednesday, the government clarified there is no proposal to close BSNL and MTNL, adding that a comprehensive plan for their revival is in the works.

“IIMA and Deloitte were engaged to facilitate the preparation of revival/restructuring plan of BSNL and MTNL, respectively. Pursuant to their recommendations and approval of respective boards, a comprehensive revival plan for BSNL and MTNL is under preparation,” Telecom Minister Ravi Shankar Prasad said.

BSNL is estimated to have the largest optical fibre cable network of 7.5 route km that can help it build a high-speed broadband network. However, it needs to purchase equipments to expand services. BSNL has sought government approval to monetise its real estate but the decision in this regard is still pending.