GoM meet on BSNL, MTNL revival deferred by a day

The meeting of the Group of Ministers (GoM) looking into the revival strategy for state- owned telecom firms BSNL and MTNL has been deferred by a day to 12 June.

'It has been deferred to 12 June,' an official source said.

The GoM, headed by Finance Minister P Chidambaram, was scheduled to meet on 11 June. The high level inter-ministerial panel has not met since the time it was constituted. It was set up following the concerns raised by Telecom Minister Kapil Sibal in a letter to Prime Minister Manmohan Singh over the future of the two loss-making PSUs. The GoM has been re-constituted following the resignation of Ashwani Kumar, who was a member as the Law Minister. Its members include Sibal, who also dons the hat of Law Minister now, Commerce and Industry Minister Anand Sharma, Planning Commission Deputy Chairman Montek Singh Ahluwalia, Information and Broadcasting Minister Manish Tewari and Minister of State in the Prime Minister's Office V Narayanasamy.

In view of national and strategic interests, the GoM has to consider and recommend measures that could be taken in the short, medium and long term for revival and revitalisation of BSNL and MTNL, sources said.

MTNL reported widening of the net loss to Rs 5,321.12 crore for financial year 2012-13, compared to Rs 4,109.78 crore in FY'12. BSNL losses are expected to be around Rs 8,198 crore for the last financial year. GoM has to decide on wages and voluntary retirement scheme for 100,000 BSNL and 20,000 MTNL employees. High wage costs had been a major reason for these companies running in to losses. Overall, the salary and pension expenses of MTNL employees form 103 per cent of the company's revenue, and for BSNL it is 49 per cent.

The revival plan includes support of Rs 10,117 crore for retaining airwaves by BSNL and MTNL beyond the initial quantity that was allocated to them for mobile and other wireless services, and simultaneously refunding Rs 12,847.77 crore on surrendering of wireless broadband spectrum that can be used for 4G services. DoT will also seek GoM's nod on the issue of MTNL's pension liabilities through lumpsum payment of around Rs 5,925 crore.