The Union Cabinet on Wednesday approved a third revival package for Bharat Sanchar Nigam (BSNL) with a total outlay of Rs 89,047 crore, seeking to help the state-owned telecom operator deploy 4G and 5G services.
This will lift BSNL’s authorised capital to Rs 2.1 trillion from Rs 1.5 trillion now. The Cabinet also cleared the allotment of 4G and 5G spectrum for the company through equity infusion.
With this spectrum allotment, BSNL will be able to provide “pan-Indian 4G and 5G services” as well as 4G coverage in “rural and uncovered villages under various connectivity projects”, the Ministry of Communications said in a statement. The telecom operator will also be able to provide fixed wireless access services for high-speed internet and services for captive non-public networks, it said.
At a press briefing after the announcement, Telecom Minister Ashwini Vaishnaw said BSNL was likely to become a net debt-free company in the next three years. “The first two packages brought BSNL out of a very difficult situation to a stable one. Now, BSNL should become a player that is able to bring connectivity to places where other commercial companies will not be able to go,” Vaishnaw said.
The government first announced a Rs 69,000-crore revival package for BSNL in October 2019. Last year, it approved a second revival package to the tune of Rs 1.64 trillion, of which a small part was for MTNL.
These packages provided BSNL financial support for capital expenditure, viability-gap funding for rural landlines, de-stressing the balance sheet, settlement of the adjusted gross revenue dues, and merger of Bharat Broadband Network Limited with itself.
In terms of fiber network connections, the company has a total subscriber base of 3.08 million.
4G/5G roll-out plans
BSNL plans to launch 5G services in Mumbai and Delhi within one year. The company is also working to install around 3,000 towers in border areas. Vaishnaw had earlier stated that BSNL would launch 5G services by November or December 2023.
BSNL is working to launch 4G services in the next few weeks. As part of the pilot for 4G, it has deployed 200 sites in three districts of Punjab.
“In the development phase, we have tested the system for 10 million simultaneous calls. Now we will conduct live tests in Amritsar, Pathankot, Chandigarh, and Firozpur till September end. After that, we will rapidly roll out around 100-200 installations every day,” Vaishnaw said.
A consortium led by IT giant Tata Consultancy Services (TCS) received last month an advance purchase order worth Rs 15,000 crore from BSNL in a widely speculated 4G network deployment deal.
The consortium, which includes Tejas Networks, Centre for Development of Telematics (C-DOT), and the central government’s public sector undertaking ITI Ltd (earlier known as Indian Telephone Industries Limited), won the bid for BSNL’s pan-India 4G project. According to sources, around 75 per cent of the deal value will go to TCS.
BSNL's plans to launch 4G service years after three private telecom service providers — Reliance Jio, Bharti Airtel and Vodafone Idea— rolled it out, rests on new sites going live quickly. Vaishnaw has said the company will install 200 new sites every day going forward. But the plans have seen repeated delays.
The BSNL board and later a Group of Ministers had approved funds for a total deal size of Rs 24,500 crore. The amount will supply 4G equipment for 100,000 sites, network gear for about Rs 13,000 crore, as well as third-party items and a 10-year annual maintenance contract (AMC).