Project for 4G services in 25K uncovered villages at `26K cr cleared
The Union Cabinet on Wednesday approved a huge package of Rs 1.64 lakh crore for the revival of State-owned telecom firm BSNL.
The revival measures approved by the Cabinet meeting chaired by Prime Minister Narendra Modi include infusion of fresh capital for upgrading services, allocating spectrum, de-stressing the balance sheet, and the company’s fiber network by merging Bharat Broadband Nigam Ltd (BBNL) with BSNL.
The Union Cabinet also approved a project for saturation of 4G mobile services in uncovered villages across the country at a total cost of Rs 26,316 crore. The project will provide 4G mobile services in 24,680 uncovered villages in remote and difficult areas, he said. Briefing media on the decision taken by the Union Cabinet, Telecom Minister Ashwini Vaishnaw said the package has a cash component of Rs 43,964 crore and a non-cash component of Rs 1.2 lakh crore spread over four years.
The Government will make administrative allocation of spectrum BSNL needs to offer 4G services. The allocation of spectrum in 900/1800 MHz band at the cost of Rs 44,993 crore would be through equity infusion.
The Minister said to meet the projected capital expenditure for next four years, the Government will fund capex of Rs 22,471 crore for developing 4G technology stack. Also, the Government will provide Rs 13,789 crore to BSNL as viability-gap funding for commercially unviable rural wireline operations done during 2014-15 to 2019-20. To de-stress the balance sheet, Rs 33,404 crore statutory dues will be converted into equity. Besides, the Government will provide sovereign guarantee for raising money to repay current loans, he said.
Vaishnaw said to facilitate wider utilisation of infrastructure laid under BharatNet, BBNL will be merged with BSNL. The infrastructure created under BharatNet will continue to be a national asset, accessible on a non-discriminatory basis to all the Telecom Service Providers.
The Minister said BSNL’s 8.6 lakh km optical fibre will be extended by merging BBNL (which has the BharatNet project under it and an optical fibre network of 5.8 lakh km). With this, BSNL will have 14 lakh km of the optical network.
“The revival package will enable BSNL to improve services and generate a net profit in 3-4 years. Its 5G services launch will happen in next 1.5-2 years,” Vaishnaw said.
“In 1-1.5 years its 4G telecom services will reach people.” On the merger of MTNL and BSNL, he said the plan is still there but “it needs complex financial restructuring”.
“More work is left so it will take it step-by-step,” he said.