A COMPREHENSIVE CASE STUDY WILL REVIVAL PLANS PROSPEROUS OR PERISH TELECOM PSU BSNL IN INDIA

© 2022 IJRAR October 2022, Volume 9, Issue 4 www.ijrar.org (E-ISSN 2348-1269, P- ISSN 2349-5138)
IJRAR22D1446 International Journal of Research and Analytical Reviews (IJRAR) www.ijrar.org 742
A COMPREHENSIVE CASE STUDY: WILL
REVIVAL PLANS PROSPEROUS OR PERISH
TELECOM PSU BSNL IN INDIA
Dr.MALLA SATYA PRASAD, K.S.SRINIVAS
ASSISTANT GENERAL MANAGER, SUB DIVISIONAL ENGINEER (RETIRED)
ENTER PRISE BUSINESS
BHATAT SANCHAR NIGAM LIMITED, VISAKHAPATNAM, INDIA
Abstract:
This paper describes a comprehensive study about the revival plans 2022 & 2019 proposed/implemented by the Government of India
as a part of one of the measures to revive the BSNL, one of the Government of India Telecom PSU in India. Due to the prevailing
conditions in BSNL, non-introduction of 4G mobile services, non-up gradation of the core network, outsourcing of the maintenance
of the old underground copper cable network, provisioning of wired services through Telecom Infra Providers (TIP) location-wise on
revenue sharing basis, etc. Also due to the severe competition prevailing in the Indian Telecom mobile sector, the convergence of
technology and the advancement to reach the last mile is a challenging task for the Mobile operators. The introduction of 5G mobile
services in India is under the final stage by the private mobile telecoms, expecting high-speed internet up to 100 Mpbs, which will be
utilized for various industrial, commercial & research applications. With the high-speed data access provisioning, implementation,
and integration of new technologies like M2M communication, IoT, AI, and Black chain technology, Cloud Computing application
projects can be introduced in totality whereas presently most of the applications purely depended on wired communication. Some of
the projects like Power sector Operation & utilizing smart metering applications for HT & LT services, monitoring of power
distribution system through SCADA projects, Water distribution system SCADA project, and Smart City application in which
monitoring from the centralized DASH board of all the smart poles, smart signalling, smart bus stations, and the terminals, SONAR,
RADAD, GPS applications using in the Fishing activities monitoring, smart agriculture using DRONE technologies, DIP irrigation
operating remotely, Various marine applications, Defence applications like the movement of the War ships, submarines are the some
of the real-time monitoring application with high-speed internet access.
Index terms:
TIP: Telecom Infra Provider, M2M: Machine to Machine, IoT: Internet of Things, AI: Artificial Intelligence, SCADA: supervisory
control and data acquisition, SONAR: Sound Navigation and Ranging, RADAR: Radio Detection and Ranging, DRONE: Dynamic
Remotely Operated Navigation Equipment, GSM: Global System for Mobile Communication, DOT: Department of
Telecommunication, MNC: Multi-National Companies, ADC: Access Deficit Charge, USO: Universal Service Obligation, IUC:
Interconnectivity Usage Charges, CDMA: Code Division Multiplexing Access, LWE: Left Wing Extremism, NOFN-National
Optical Fiber Network, CFA: Consumer Fixed Access, CM: Consumer Mobility, ICT-Information and Communication Technology.
I. Introduction:
As the present telecom market especially the mobile sector in India is vibrant, and competitive in respect of the market
share, maintenance of QoS parameters as per the regulatory guidelines and seamless mobile coverage are the expectations of the end
user. Nowadays the market share completely depends upon the new generation technology and the operator first to introduce the
latest technology will have the edge over other telecom operators, which was witnessed in the year 2017 when RJIO entered with 4G
Mobile technology along with a disruptive marketing strategy. In the earlier days, telecom services under DOT extended the services
in India as a monopoly, due to the introduction of National Telecom Policies 1994, 1999, 2012, and finally National Digital
Communications Policy- 2018 monopoly telecom sector converted into duopoly sector and various MNC companies in collaboration
with Indian Corporate companies ventured into telecom sector and extended/extending various services in different verticals. The
introduction of new generation technology and adoption of the latest smart applications is the need of the hour to increase the market
share as well as to retain the existing customers.

II. Back Drop of Mobile Services in BSNL and its expansion:
2.1. Analysis of BSNL downfall especially in the Mobile service sector and role of GOI:
BSNL took birth on 01.10.2000 as a matter of policy compulsion, consequent upon opening up of the telecom sector to the
private capital as a sequel to the implementation of the National Telecom policy promulgated in 1995. Since the birth of BSNL,
successive Governments used it as a milking cow to meet the social obligations of the Telecom Policy particularly, meeting the
fundamental and envisaged objective of the National Telecom policy set out in 1988 by the first Telecom Commission of the Country
- Affordable Telecom Services of Universal Quality.
While BSNL was forced to provide telecom services, in the remotest inaccessible areas of the Country, the concrete policy
commitments that were made by the Government to support BSNL to provide services in these highly uncompensated, loss-making
areas systematically and gradually started getting eroded. Access Deficit Charge (ADC) and USO Fund subsidy were arbitrarily
stopped, IUC charges were drastically slashed, private operators were allowed to change over from fixed license fees to revenue
sharing, etc. The government did not allow BSNL to start mobile services till 2002, giving a strategic market advantage to early
movers like Airtel. All these policy breaches by the Government adversely and irreversibly hit the revenues of BSNL, and
jeopardized the growth of the incumbent operator. Even though BSNL's entry into the high potential mobile segment was delayed by
more than two years, BSNL came very close to the then leading mobile service provider, Airtel, in terms of mobile market share in
the year 2006 with incoming call free and outgoing call per minute with nominal tariff.
2.2. Effect on BSNL Mobile market share due to GOI Interventions:
BSNL received the deadliest ever blow in the year 2007 when its highly ambitious mobile tender for procurement of 45.5 m
GSM lines finalized in an exemplary transparent manner spanning over two years was set ablaze because of government interference.
This caused considerable delay in the procurement of GSM Equipment for BSNL. The then Government wanted to cancel the
Tender. After the agitation of all Executives & Non Executives in July 2007, the Ministry allowed BSNL to place an order for 50%
of the quantity of the approved Tender i.e. 23 Million GSM Lines. The immediate and catastrophic consequences such as
unwarranted interference of MOC&IT in reducing the procurement of the equipment by 50% were that BSNL started hemorrhaging
heavily in the mobile sector.
This was visible from the data vide table number 1, which reveals that in the year 2006, BSNL and Airtel were running in a
parallel manner in the GSM segment, each pegged at about 20 million odd GSM lines. During the three critical years from 2006 to
2010, Airtel was allowed to continue its unabated forward march with unbridled freedom. It procured equipment even from Chinese
Companies from which BSNL is forbidden to procure and enjoyed total immunity from adhering to licensing regulations of the
policy maker, adding about 90 million GSM lines. In sharp contrast, BSNL was left completely paralyzed due to a 50% reduction of
the size of the tender and could just add 30 million lines in the corresponding period because of the high potential Circles of BSNL
like AP, Karnataka, TN, Chennai, Kerala, Gujarat, Maharashtra, etc. were left high and dry as BSNL could not provide any GSM
lines due to complete non-availability of GSM equipment. These potential Circles could not add even a single GSM line to enhance
their market share. The strategic jump that Airtel and other private operators could attain during this period is only because BSNL
was deliberately strangulated from growing.
The following table.1 shows the mobile subscriber base in India from March 2002 to March 2006 for all the mobile service
providers. It clearly shows the progress of the mobile customer base of BSNL gradually increasing from 0.04% in the year 2002 to
17.65% in the year 2006.
Table.1: Subscriber base of Mobile services from March 2002 – March 2006
(Source: www.Trai.gov.in)
Service
Providers
FY
2002
FY
2003
FY
2004
FY
2005
FY
2006
%age
Growth over
FY 2005
Bharathi 1.35 3.07 6.05 10.98 19.58 78.32%
Reliance 0.38 0.54 7.26 10.45 17.31 65.65%
BSNL 0.04 2.29 5.53 9.90 17.65 78.28%
Hutch 1.27 2.16 5.15 7.80 15.36 96.92%
Idea 0.81 1.28 2.73 5.07 7.37 45.36%
Escotel 0.05 0.59 0.99
BPL Group 0.90 1.13 1.88 2.58 1.34 -48.06%
Aircel 0.54 0.73 1.29 1.76 2.61 48.30%
Spice 0.47 0.64 1.21 1.44 1.93 34.03%
Tata/ Huges 0.05 0.16 0.63 1.09 4.85 344.95%
MTNL 0.22 0.35 0.46 1.08 2.05 89.81%
HFCL 0.01 0.03 0.03 0.05 0.06 20.00%
Shyam 0.004 0.03 0.03 0.03 0.03 0%
Total 6.54 13.00 33.69 52.22 90.14 72.62%

The following table.2 shows the market share of the different mobile service providers in India as on March 2006. For
BSNL the number of subscribers was 17.65 million and the market share as on March 2006 is 19.58%.
Table.2: Market share of Mobile operators as on March 2006
S.No. Mobile Group Number of Subscribers
(in Millions)
Market Share
as on March 2006
1 Bharathi 19.58 21.72%
2 BSNL 17.65 19.58%
3 Reliance 17.31 19.21%
4 Hutch 15.36 17.04%
5 Idea 7.37 8.18%
6 BPL Group 1.34 1.49%
7 Aircel 2.61 2.90%
8 Spice 1.93 2.14%
9 Tata Teleservice 4.85 5.38%
10 MTNL 2.05 2.27%
11 HFCL 0.06 0.07%
12 Shyam 0.03 0.03%
Total 90.14
The following table.3 shows the market share of the mobile operators in terms of the subscriber base in India as on March
2007. As on March 2007, BSNL had 30.99 million mobile customers and the market share was 18.77% and the second highest after
Bharati (Airtel) which is having a market share of 22.49%.
Table.3: Market share of Mobile operators in terms of Subscriber base as on March 2007
Service Providers Number of Subscribers
(in Millions)
Market Share as on March 07
(in % age)
Bharati 37.14 22.49
BSNL 30.99 18.77
Reliance 28.01 16.96
Hutch 26.44 16.01
Tata 16.02 9.70
Idea 14.01 8.49
Aircel 5.51 3.34
MTNL 2.94 1.78
Spice 2.73 1.65
BPL 1.07 0.65
HFCL 0.15 0.10
Shyam 0.0 0.06
Total 165.11 100.00
Also from the below figure.1, the market share of the BSNL as on March 2010 is 13.22% and shifted to the fourth position
and the Bharati (Airtel), Vodafone, and IDEA / SPICE occupied the first, second, and third positions. This is due to the cancellation
of procurement of the mobile equipment and subsequently purchasing 50% of the required equipment.

Fig.1 Market share of Mobile operators (%) as of 31st
March 2010
Table.4: Wireless Subscriber base growth in India 2005 -2011
Year Wireless (in millions)
BSNL Vodafone Bharati Reliance Tata Aircel Others Total
2005-06 19.74 15.36 19.60 20.21 8.46 2.61 28.16 98.78
2006-07 30.98 26.44 37.14 28.01 16.02 5.51 21.01 165.11
2007-08 40.63 44.13 61.98 45.79 24.33 10.61 33.60 261.07
2008-09 52.15 68.77 93.92 72.67 35.12 18.48 50.65 391.76
2009-10 69.45 100.86 127.62 102.42 65.94 36.86 81.19 584.32
2010-11 91.83 134.57 162.20 135.72 89.14 54.84 143.29 811.59
From the above table.4, it is inferred that the Wireless subscriber base exponentially increased from 98.78 million from
2005-06 to 811.59 million in 2010-11, that in a span of 6 years 712.81 million were added, and during the same period in BSNL only
72.09 million only added due to the various reasons already mentioned above.
III. BSNL Financial Performance report 2013 to 2021:
Table .5: Financial performance reports from 2013-14 to 2020-21: (In Lakhs)
Sl.No. Financial year Revenue
Inflow
Expenditure Profit/Loss Staff Expenses
1 2020-21 18,59,481 26,03,593 -7,44,112 6,67,916
2 2019-20 18,90,656 34,40,608 -15,49,952 13,59,678
3 2018-19 19,32,067 34,22,491 -14,90,424 14,49,200
4 2017-18 25,07,064 33,80,880 - 8,73,816 13,48,400
5 2016-17 31,53,344 36,32,665 -4,79,321 13,83,100
6 2015-16 32,91,870 36,74,272 -3,82,402 13,78,300
7 2014-15 28,64,520 37,29,210 -8,64,690 13,59,500
8 2013-14 27,99,635 34,92,960 -6,93,325 13,21,300
The table.5 shows the financial performance of the BSNL from 2013-14 to 2020-21, where the staff expenses were
drastically reduced to more than 50% after implementation of VRS 2019.
IV.BSNL & MTNL Revival Plan 2019:
The government of India has announced the first revival plan to stabilize the state-owned Telecom Companies BSNL & MTNL of
India. The main components of the revival plan are as follows:
 Voluntary Retirement Scheme (VRS-2019) for employees of age 50 years and above
 Allotment of 4 G Spectrum & Full cost of the Spectrum
 Government support for Sovereign Guarantee Bonds

 BSNL Asset Monetization Scheme
 The merger of BSNL & MTNL
Table.6 BSNL Revival Plan 2019
V. Implementation of Revival Plan 2019:
5.1. Voluntary Retirement Scheme (VRS-2019) to employees:
The government of India announced on 23rd
October 2019 the revival package of BSNL & MTNL, in which the employees
who completed 50 years of age are eligible for opting for VRS. Under this, an ex-gratia of Rs.17,169 crore was allotted to meet the
expenses towards pension, gratuity, and Commutations 92,500 employees of BSNL and MTNL opted for VRS nearly 8500 crores
will be saved annually towards salaries. From BSNL 78,235 employees opted for VRS.
Table .7: Number of employees availed VRS-2019
PSU Number of Employees availed of VRS-2019 scheme
No. of Executives No. of Non-Executives Total
BSNL 13305 64930 78235
5.2. Challenges due to VRS:
 After the implementation of VRS 2019, 2916 Group"A", 28775 Group"B" officers, 16013 Group"C" and 5366 Group" D"
officials remained in the organization. Due to that, in the CFA sector maintenance of legacy copper cable network is given
to the experience organizations Business Area (BA) wise by dividing the total geographical area into manageable clusters.
Also provisioning of the new FTTH connections over fiber and the maintenance of existing connections location wise
entrusted to Telecom Infra Providers (TIP). The existing staff will be utilized exclusively for monitoring and driving the
cluster maintenance partners and the TIPs for operation and provisioning.
 For the CM sector maintenance of the existing mobile towers, infra maintenance given to the experienced contractor BA
wise, the maintenance of MSC, BSC, BTS including RF maintenance, installation, rearrangement of existing BTSs,
conducting drive test to optimize the radio network and EMF radiation testing is being carried out by the working
officers/officials.
 The remaining activities like Strategic Planning in CFA & CM, Human resource management, Finance, legal issues,
marketing, Enterprise business, CM sales franchisee management with the support of the private parties for manning
Customer service centers, and pre-paid mobile distribution system through CMTS is being managed by the in house
executives and non-executives.
Revival Plan
Component
Support of Government of India Expected outcome
Voluntary Retirement
Scheme
(VRS-2019)
The ex-gratia component of the scheme comes
at Rs.17, 169 crores with the cost of pension,
gratuity, and commutation to be borne by the
Government
Reduction of Staff aged >50 years
4G Spectrum
(at 2016 price)
The full cost of the spectrum (excluding goods
and services tax) of Rs.14, 115 crores. GST
component of Rs.3, 674 crores funded through
a budgetary allocation from the government
Able to compete in Market
Sovereign Guarantee
Bonds
Sovereign guarantee bonds of Rs.8500
crore
To meet operations and
maintenance costs
BSNL Asset
Monetization Scheme
Rs.38,000 crore-asset monetization scheme
over a period of four years
To raise resources for retiring debt,
servicing of bonds, network up-
gradation, expansion, and meeting
the operational expenses
The merger of BSNL
& MTNL
MTNL will be merged into BSNL (subsidiary
to BSNL till merger)
Resultant BSNL has a 100%
presence in India.

5.2.1. Allotment of 4 G Spectrum & Full cost of the Spectrum:
Allotment of the 4G spectrum & bearing full cost of the spectrum recommendations remains on paper only. So far except
for BSNL & MTNL, all the mobile Telecom service providers in India already introduced 4 G services during the year 2017. Even
though the 4G spectrum valued at Rs.23,814 crores would be allotted to BSNL, the company was never allowed to make use of the
same, due to roadblocks created by the different government agencies for the procurement of the 4G equipment.
5.2.2. Roadblock in the procurement of 4G Equipment:
To roll out its 4G services, BSNL has floated a tender on 23.03.2020 for the supply, deployment, and maintenance of 4G
equipment at 50,000 sites, at the cost of around Rs 9,300 Crores. BSNL's tender to procure the 4G equipment has hit roadblocks. The
Telecom Equipment and Services Export Promotion Council (TEPC), an industry body, has complained to the Department of
Commerce that, the BSNL’s tendering process has flouted the Government of India’s policy of “Make in India” and was heavily in
favor of multinational companies.
The TEPC has taken exception to some of the conditions of the tender, which stipulates that:
 The bidding companies should have prior experience having set up a mobile network for at least 20 million 4G lines.
 National Security would be compromised if BSNL purchases 4G equipment from MNCs.
 The potential bidders should have Rs 8,000-crore turnover in the previous two fiscals.
The Department of Commerce and the Department of Telecommunications have directed the BSNL to rework its tender,
considering the complaints of the TEPC. This episode results in re-inventing 4G technology by Indian companies, whereas the rest of
the Telecom companies in India are busy in POC of the equipment for the launching of 5G services as well as working for 6G
evolution in the coming years. Finally, BSNL is forced to identify an Indian company to have locally developed 4G gear under make
in India.
The TCS has been identified to supply 4G equipment to BSNL, 30th
November 2021 was the deadline fixed by the DoT, for
TCS to complete its “Proof of Concept (PoC)”. Many extensions were given to the TCS to complete its PoC. However, the
TCS has not been able to complete its PoC till date officially. The private mobile operators are allowed to use world-class equipment,
supplied by global vendors, only BSNL alone is being compelled to procure the unproven equipment from Indian vendors which
were not yet tested.
In earlier procurements of BSNL, more than one vendor participated in the tendering process and supplied equipment to BSNL.
However, presently, BSNL has been compelled to procure equipment only from TCS. Being the sole vendor, TCS has not accepted
BSNL’s Purchase Order (PO) placed on 31.03.2022, for the procurement of 6,400 4G BTSs. TCS is dictating terms to BSNL. BSNL
has got no other go, but to accept the terms and conditions of TCS.
The denial of a level playing field to BSNL vis-à-vis the private mobile operators delivered a dead blow to BSNL for 4G
launching. Presently the launching of BSNL 4G is not at all at the site.
5.2.3. BSNL Assets monetization:
The government of India agreed to Rs.38, 000 crores worth of BSNL assets monetization over a period of 4 years from 2019
to 2023. This will help to raise resources for retiring debt, servicing of bonds, network up-gradation, and expansion, and also meeting
the operational expenses. To simplify the process, BSNL management also wants to allocate its land resources in principle to other
government departments and agencies. But so far partially asset monetization completed not as recommended.
5.2.4. Restructuring via Rs 15,000 crore worth of bonds:
BSNL & MTNL will raise long-term bonds of Rs.15, 000 crore for which a sovereign guarantee will be provided by GOI. It
will restructure the existing debt and partly meet capital (CAPEX) and Operational (OPEX) expenditures. This process has already
been completed.
5.2.5. Merger between BSNL & MTNL:
Under the revival, another decision of GOI is the merger of MTNL with BSNL. MTNL was created by an enactment in the
Parliament and its stocks are listed, while BSNL was created under the Company's Act and is not a listed Company. Until the
resolution of all the issued MTNL will continue as a subsidiary for the BSNL. As of date, the operations of all the services are being
carried out by the BSNL only; HR issues have not yet merged due to some pending pay and promotion issues for
executives which were not yet settled.

Table .8: Implementation Status of Revival Plan - 2019
S.No. Revival Plan-2019 Component Present Status
1 Voluntary Retirement Scheme (VRS-2019) Completed.
2 4G Spectrum (at 2016 price) Services not launched to date
3 Sovereign Guarantee Bonds Completed
4 BSNL Asset Monetization Scheme Initiated
5 The merger of BSNL & MTNL Till date instead of the merger, MTNL continues as a
subsidiary of BSNL, to date operations of services
are only carried out by BSNL.
VI. BSNL Revival Plan 2022:
The union cabinet of India announced the 2nd
Revival package for BSNL/ MTNL on 27-07-2022 as a “Revival of BSNL
and merger of BBNL with BSNL”.
This package has mainly three main elements:
1. It will aim at improving the quality of BSNL services.
2. It will be used to de-stressing the balance sheet.
3. It will attempt to expand the company's fiber reach.
Table .9.Revival Plan 2022
6.1. Upgrading BSNL Services / improving the quality of BSNL services:
6.1.1. Administrative allotment of Spectrum & Procurement of 4G Equipment:
To improve existing services and provide 4G services, BSNL will be allotted Spectrum in 900/1800 MHz band
administratively at the cost of Rs 44,993 Cr (with GST of Rs.6836 Crs) through equity infusion in BSNL in the financial year 2022-
23 subject to revision of said amount as per price discovered in the auction conducted in the financial year 2022. Allotment to BSNL
will be done in all LSAs with effect from 29-02-2022 and the date of allotment in Delhi / Mumbai LSAs. The cost on a pro-rata basis
will be settled for spectrum held by MTNL (5MHz in Delhi / Mumbai) from 05-04-2019 till the date of spectrum allotment to BSNL.
The license-related conditions will be as applicable under the exact policy.
BSNL will provide telecom services in Delhi and Mumbai through the leasing of operational assets or other appropriate
models. With operations by BSNL in Delhi/Mumbai, MTNL would leave with land/building assets which it will continue to
monetize to discharge its loan liabilities. Also, the process to be followed for procurement of 4G equipment under the Atmanirbhar
initiative will be placed before the GoM for approval. Accordingly, BSNL will finalize the procurement.
An important component of the Revival Package 2022, is the allotment of 4G spectrum to BSNL, for which the
government will spend Rs.44, 993 crores. Already in the Revival Package 2019, the government had stated that it would
spend Rs.23, 814 crores for the allotment of 4G spectrum to BSNL. Again, in February 2022, the Hon’ble Finance minister
announced during the Budget speech that, Rs.44, 000 crore would be spent for BSNL’s technology upgradation. Now, in the 2nd
Revival Package, it has been stated that the government would spend Rs.44, 993 crores, for the allotment of 4G spectrum to
BSNL. So adding together, all the allotments/announcements made by this government, for the allotment of 4G spectrum to
BSNL, it comes to a staggering Rs.1, 12,807 crores.
S.No. Description Details
1 Improving the quality of
BSNL services
Administrative allotment of Spectrum & Procurement of 4G
Equipment
Financial support for CAPEX
Viability gap funding for rural wireline operations
Increase in authorized capital
Raising Sovereign Guarantee bonds by MTNL
2 De-stressing BSNL the
balance sheet
Debt structuring
Financial support for AGR dues
Re-issue of preference shares
Sanction of Viability Gap Fund
3 Expand the company's
fiber reach
The merger of BBNL with BSNL
4 Deputation of ITS officers
in BSNL
From the formation of BSNL to till date ITS officers working on
deemed deputation & very few of them are absorbed in BSNL

6.1.2. Financial support for CAPEX:
To promote indigenous technology development, BSNL is in process of deploying the Atmanirbhar 4G technology stack. To
meet the projected capital expenditure for the next 4 years, Government will fund CAPEX of Rs 22,471 Cr. This will be a significant
boost to the development and deployment of the Atmanirbhar 4G stack.
6.1.3. Viability gap funding for rural wire line operations:
Despite the commercial non-viability, BSNL has been providing wire line services in rural /remote areas to meet the social
objectives of the Government. The government will provide Rs 13,789 Cr to BSNL as viability gap funding for commercially
unviable rural wire-line operations done during 2014-15 to 2019-20.
6.1.4. Increase in the authorized capital:
The authorized capital of BSNL will be increased from Rs.40, 000 Cr to Rs.1, 50,000 Cr in lieu of AGR dues, provision of
CAPEX, and allotment of spectrum.
6.1.5. Raising Sovereign Guarantee bonds by MTNL:
Raising Sovereign Guarantee bonds by MTNL with tenure of 10 years or more, for a number of Rs. 17,571 Cr (Rs.10, 910
Cr in FY 2022-23 and Rs. 6,661 Cr in FY 2023-24) with the waiver of guarantee fee, to repay the high-cost debt and restructure it
with the new sustainable loan. The principal /interest will be repaid by MTNL through the proceeds of rental /sale of land /building
assets. Given the unsustainable debt of MTNL, for a further detailed examination to resolve matters such as asset monetization, AGR
dues, debt resolution and further course of action for the merger of MTNL with BSNL, a Committee of Secretaries (CoS) comprising
of Secretary DoE, Secretary DoT, Secretary DIPAM and Secretary DPE will be constituted to recommend the forwarding. The
Finance Minister and Minister of Communications will be empowered to decide the way forward. The Government will provide
budgetary support of Rs. 1,600 Cr for restructuring and operational integration of the Telecom PSUs as a one-time grant.
6.2. De-stressing BSNL balance sheet:
6.2.1 Debt structuring:
The government will provide sovereign guarantee bonds to these PSUs for raising long-term loans with a tenure of 10 years
or more for an amount of Rs.22, 828 Cr over three Financial years, Rs. 8466Cr in 2022-23, Rs.6522 Cr in 2023-24, and Rs.7860 Cr
in 2024-25 with a waiver off guarantee fee, to repay high-cost debt and restructure it with the new suitable loan. BSNL will
repay the principal /interest. They will be able to raise long-term bonds for an amount of Rs 40,399 Cr. This will help restructure
existing debt and de-stressing the balance sheets.
6.2.2. Financial support for AGR dues:
To further improve the balance sheet, AGR dues of BSNL amounting to Rs 33,404 Cr as of 31-03-2022 including GST of
5,344 Cr will be settled by conversion into equity up to 5 years w.e.f. 1st
April 2022. The exact AGR dues /interest will be certified
by DoT.
6.2.3. Re-issue of preference shares:
BSNL will re-issue 9% of the non-cumulative preference share of Rs 7,500 Cr to the Government. The government will
make budgetary provisions for Rs 7,500 Cr in the financial year 2022-23.
With these measures, BSNL will be able to improve the quality of existing services, roll out 4G services and become
financially viable.
6.2.4. Sanction of Viability Gap Fund:
As a Viability gap Rs.13, 789 Cr will be Sanctioned in the form of a grant-in-aid to BSNL towards unviable rural wire-line
operations for the FY 2014-15 to 2019-20 through budgetary support in FY 2022-23. Similar reimbursement will also be allowed to
BSNL for FY2020-21 onwards for five years also on this principle, subject to a ceiling of Rs.7, 200 Cr for this duration of six years.
6.2.5. Refund to be made by the Government to BSNL:
The government of India has to refund BSNL to the tune of Rs. 24,751 crores of rupees towards the cost of CDMA
spectrum which surrender in the circles of Karnataka, Tamil Nadu, Kolkata, Andhra Pradesh, and Maharashtra as surplus. The
outstanding amount from the Government project NOFN Bharat net, Interest on the Wi-Max spectrum Surrender, refund of the
excess amount paid to the DoT towards pension contribution for the employees who were recruited in DoT, reimbursement of Leave
encashment for the DoT period in respect of the employees those are absorbed from the DoT, execution & operational charges of the
LWE project, the rental charges towards the provisioning of Building/office space and staff quarters for the DoT, different staff
related claims from the DoT, rentals to provide telecom services for the DoT in the country, USO fund claim pertaining to Andaman

& Nicobar, Lakshadweep, and Jammu& Kashmir, provisioning of 25,000 Wi-Fi Hot spots in the country and Viability gap funding to
provide communication during Amarnath Yatra as mentioned in table .10.
Table .10: Refund to be made by the GOI to BSNL
S.No. Details Rs.
( in Crore)
1 Surrender of CDMA Spectrum 2,472
2 Government Projects – NOFN (BharatNet) 1,051
3 Interest in Wi-Max Spectrum Surrendered 5,850
4 Refund of Excess paid Pension Contribution 1,996
5 Reimbursement of Leave Encashment against DoT period inrespect
of absorbed employees.
11,998
6 LWE Project 380
7 Providing Building/Office space/Staff quarters etc., to DoT 320
8 Staff related claims
(i.e., Salary of BSNL staff working/worked inDoT, Loans & Advances
paid by BSNL to unabsorbed employeesof DoT, Leave salary paid to
DoT employees (unabsorbed) & LSPC paid during the Leave period,
etc.)
225
9 Providing Telecom Services to DoT 282
10 Claims from USOF w.r.t. A&N, Lakshadweep, Assam 30
11 25,000 Wi-fi Hotspot Project 131
12 Viability Gap Funding for Amaranth Yatra 16
Total 24,751
6.3. Merger of BBNL with BSNL to expand the Fiber reaches to Village panchayats:
A Special purpose vehicle (SPV) BBNL was formed in February 2012, to lay out an optical fiber network across 2.5 lakh
village panchayats across the country using USOF and provide access to all telecom operators on a non-discriminatory basis. Now
the GOI proposed BBNL will be merged with BSNL, as BSNL already has a network of over 6.8 lakh kilometers of optical fiber
cable (OFC) network. With the proposed merger, BSNL will get 5.67 lakh kilometers of optical fiber which has been laid across 1.85
lakh village panchayats in the country using the Universal Service Obligation Fund (USOF).
6.3.1. Roles /responsibilities being discharged by BBNL will be carried out by BSNL, with the following guiding principles:
 Bharath Net is to be funded by USOF and infrastructure to be a National asset owned by USOF, accessible on a non-
discriminatory basis to all service providers.
 BSNL is to be responsible for targets by Government for FTTH services in all villages.
 Agreement to be signed between USOF and BSNL on constructions, O&M, utilization of the BharatNet network,
payment terms and conditions, etc.
 Payment for O&M works to be based on outcome-linked measurable Service Level Agreements (SLAs) including
penalties for non-performance. Payments for the construction of the network are to be based on the achievement of the
milestones.
 The Minister of Communications has delegated the powers to take decisionson all issues arising out of the merger of
BBNL with BSNL.
VII. Continuation of Deputation of Government employees i.e. ITS officers in the merged PSU BSNL:
Amendment in Special Reserve for posting of ITS Group-A officers in BSNL/MTNL as per Cabinet decision 2016, to
operate 560 ITS cadre posts(HAG—34, SAG-353, JAG-173) in BSNL/MTNL on a non-diminishing basis for five years (from Jan
2022 to Dec 2026). The special reserve is to be diminished in a phased manner thereafter as the PSUs develop their cadre.
BSNL is incurring ₹90-100 crore per year as salary and other expenses (allowances) to PGMs and GMs who are on
deputation from the Department of Telecommunications (DoT), as they are being paid 7th
Pay commission recommended pay scales
whereas the officers working in BSNL absorbed/recruited cannot be given 3rd
Pay revision and is due from the year 2017. As per a
Cabinet decision taken in 2013, the maximum number of PGMs and GMs to be deployed in BSNL was 293 and 199 for FY2021-22.
However, there are about 425 officials on deputation with BSNL today, which is 128 more than the number permitted by the
government, and this would rise to 226 by April 2021.BSNL reduced its employee strength by more than 50 percent through
voluntary retirement in 2019. BSNL's outgo of ₹90-100 crore to these "excess officers" comes at a time when the company is not
able to pay its own employees' salaries on time. The senior officers on deputation also to be reduced proportionately, as per the
Cabinet decision, but as per the revival package 2022, another some more officers additionally will be deployed in, BSNL has to pay

7th
Pay commission recommended pay scales whereas those who are adsorbed/recruited in BSNL working without 3rd
PRC pay
revision implementation since last 5 years.
 Positive side of
o DOT is the reporting department for BSNL, which is full of ITS officers, so deliberations on various issues can be
managed simply.
 Adverse side of
o ITS officers have the facility of deputation to various Government / Departments under open option, so many times
the ITS officers were deputed in BSNL are opting to go to other departments, this hampers and impacts on the
performance of BSNL being these ITS officers positioned at management and decision-making levels in the PSU.
o Belongingness is a big confusion among these deputed ITS officers, as they finally need to join back to DOT and
work under Government.
o No higher management positions DGM and above were filled by BSNL absorbed/recruited as Group “B” officers,
only Government ITS got that opportunity till date even tough formation of BSNL completed more than 21 years.
VIII. Reasons for reviving BSNL by the GOI:
 As the majority of private mobile operators not having good reach in the rural, agency, and remote areas, where
BSNL has its presence in that areas, with the merger of BBNL with BSNL the presence in the rural area still
increases for BSNL. Even though RJIO in its expansion project of mobile services and Airtel intensify the
establishment of new BTSs in the rural areas still BSNL remains a strong player there. The experience with
coverage through private operators using the USO Fund as a viability gap measure was not very effective in
achieving the objective of NTPs.
 The key factor is security considerations. As the country is growing increasingly digital and security threats in the
digital space mount, there may be a felt need for having an instrument of the government-owned Telecom
Company BSNL, which could directly address some of its high-priority and high-security communication
requirements.
 The need for coverage of difficult regions such as extremist-affected areas (LWE). Lack of coverage in such areas
is not due to economic factors, but other factors like the law-and-order situation. Such areas may require special
effort to provide coverage. This is regarded as important from both a security point of view as well as from a
societal point of view.
 Another factor is making use of a spectrum that remains unsold and unused. Presently in India, only three private
operators and there are growing concerns of a possible duopoly dominance in the mobile sector. As a policy
decision, GOI injecting a little more competition may have been seen to have some virtue.
 BSNL suffered a loss of Rs.50631 crores in the past five years. The GOI initiated the first revival package in 2019,
which reduces losses from Rs.15,500 crores in financial 2020 to Rs.7441 crores in financial 2021. The plan
includes measures to reduce the staff cost through VRS, administrative allotment of spectrum for 4G services, and
debt restructuring by raising Sovereign Guarantee Bonds.
IX. Suggestions for the prosperous of BSNL utilizing revival plans:
9.1. Addressing the merger challenges:
 Micromanagement of network /equipment / infrastructure components of MTNL & BBNL
o The operational costs such as maintenance /repair contracts of MTNL / BBNL equipment/networks and their up
gradations.
o Health check of the fiber cable network of MTNL as well address the operational / maintenance/repair contracts &
plan of integration among PSUs.
o Health check of the fiber cable network of BBNL as well address the operational / maintenance/repair contracts &
plan of integration among PSUs
 Training of other PSU employees (own or outsourced) to tune with BSNL working /reporting /operations.
 Leveling service offerings such as tariff structures, sales, and Business promotion to have uniformity across these PSUs and
to have a common promotional plan.
9.2. Defining timelines for each revival plan component and its execution:
The recommendations in the revival plan 2019 & 2022 are to be implemented in true spirit without creating any
hurdles and extending the financial support by the GOI for the projects which were allotted under the universal service obligation in
time, will avoid the operational losses for the BSNL and also upkeep and maintenance of the existing telecom networks and in time
up gradation of the same to meet the day to day challenges.

9.3. Coming out with a clear strategy for the launching of 4G / 5G services on par with other market players:
To improve existing services and provide 4G services, BSNL will be allotted Spectrum in the 900/1800 MHz band
administratively at the cost of Rs 44,993 crore through equity infusion. With this spectrum, BSNL will be able to compete in the
market and provide high-speed data using their vast network including in rural areas. Even though the 2019 revival plan gave
direction for the allotment of 4G spectrum and procurement of 4G equipment by BSNL, due to the TEPC's objection to purchasing
4G equipment from the Indian manufacturing companies only under make in-India project which was not available even after the
passage of 3 years so far and no confirmation about the POC of 4G equipment which was manufacturing by CDOT, in collaboration
with ITI and TCS. Hence GOI has to decide on the procurement of the 4G equipment by the BSNL from the MNC companies as
being procured by the other service providers as early as possible to roll out 4G services and subsequently 5G also.
9.4 .BSNL board has to empower in making decisions regarding policy matters, particularly in HR, Procurement, operational, and
enterprise business activities without GOI interference.
9.5. When all the private companies, viz., Reliance Jio, Airtel, and Vodafone Idea are procuring their equipment from global vendors
like Nokia, Ericsson, and Samsung, why BSNL alone should be directed to procure 4G equipment only from Indian vendors. This is
nothing but a denial of level playing ground, which has severely affected the Company’s revival.
9.6 Even at this late stage, BSNL can start its 4G service in the very profitable South Zone and West Zone, within a few weeks, if the
Company is permitted to get its 19,000 existing BTSs upgraded by Nokia. This up gradation will only cost BSNL around Rs.500
crore.
9.7. BSNL will be able to compete with Private Operators after the implementation of Revival Packages 2019 & 2022:
As per the TRAI report as on 31st
May 2022, the mobile market share of private telecom service providers was 89.97%, whereas
BSNL & MTNL was 10.13%. Also, all the leading private mobile operators actively and aggressively participated in the 5G
spectrum bidding, it would be a tough task for BSNL to face the competition from private mobile operators who are currently well
established and better placed in the market. However, the government seems to keep BSNL for a “defined set of customers” and
expects the loss-making telecom company to turn profitable by the FY 2026-27. As the administrative allocation of spectrum for 4G
and 5G services for BSNL has also been approved by the Cabinet, GOI expects to expand 4G services to raise ARPU to Rs.170-180
after the revival package in 2022.
X. Conclusion:
As BSNL is a strategic asset of the Nation, being a telecom company the role of BSNL cannot underestimate in "Nation-
Building". The private telecom companies were allowed to operate mobile services, 2G in India in 1995, whereas BSNL was allowed
to operate the same in 2002. Similarly, 4G services were launched by the private operators in the year 2016, however, it was denied
to BSNL, as a result, and BSNL struggled to launch 4G services due to various reasons as presented above. As India progresses
towards switching over to 5G technology, spectrum auction by the GOI is already completed, launching of 5G services in India by
the private telecom operators was already in the advanced stage, but the launching of 4G and 5G technology mobile services by the
BSNL is not known. Hence at least now GOI has to take initiation for the procurement of the mobile equipment and initiate the early
launching of the mobile services with 4G / 5G technologies either by procuring equipment from MNC companies or through Make In
India whichever is earlier to provide a level playing field on par with other private mobile operators' to retain the existing customer
base and also to compete in the wireless access technologies with high speed data to provide the last mile solution for various latest /
upcoming innovative applications in ICT/ AI / Cloud Computing / M2M and for emerging Internet Data Centers etc.
REFERENCES:
1. International Journal of Research and Analytical Review (IJRAR) on “A COMPREHENSIVE STUDY ON BSNL
REVIVAL CASE STUDY OF VOLUNTARY RETIREMENT SCHEME (VRS) -2019.” Volume 7 | Issue 1 | March 2020,
D.O.I : http://doi.one/10.1729/Journal.24623.
2. International Journal of Scientific Development and Research (IJSDR) on “Outlook on Public Sector Telecom Provider
(BSNL&MTNL) in India-Continues to Bleed” Volume 5 | Issue 6 | June 2020. D.O.I: http: //doi. one/
10.1729/Journal.24601.
3. Department of Telecommunication Office Memorandum F.No.20-28 /2022-PR Date: 2nd August 2022 on Revival of BSNL
and merger of BBNL with BSNL.
4. https://www.bqprime.com/business/why-bsnl-is-being-revived
5. https://iasbaba.com/2022/08/babas-explainer-reviving-bsnl/
6. Press statements from https://www.bsnleu.in , Dated: 04-07-2022; 28-07-2022 & 08-08-2022.

A COMPREHENSIVE CASE STUDY WILL REVIVAL PLANS PROSPEROUS OR PERISH TELECOM PSU BSNL IN INDIA

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