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Par panel for setting up expert group to suggest measures for BSNL, MTNL turnaround

PTI     December 20, 2018

New Delhi, Dec 20 (PTI) A parliamentary panel Thursday asked the government to set up an expert group for technology public sector firms including BSNL and MTNL, which will recommend measures for the turnaround of these companies. The Committee on Public Undertakings recommended that the group of experts should also recommend measures for giving preference to services of PSUs at least till the time their trunaround is achieved. "The committee is of the considered view that for sick/loss-making CPSUs, particularly working in complex technology sectors, a group of experts needs to be consulted, ideally as soon as the company starts losing market for their products, to explore and recommend timely updation of technology for their turnaround," the committee chaired by BJP MP Shanta Kumar said. The panel noted that unavailability of 4G spectrum with public sector firm MTNL is one of the reasons for its loss, adding that its customers complain about call drops or similar issues which result in their shifting to other telecom service providers. It said that the procurement of processes of public sector firms should be given desired level of independence which their counterparts in the private sector have; otherwise PSUs will not be able to compete in the market. The panel also noted submission by BSNL which said that procurement processes are still very cumbersome in comparison to private players. BSNL chairman and managing director Anupam Shrivastava informed the panel that the company is working to change the procurement process to some extent. "Some kind of modifications are on the cards, but at the same time, we are not on the same footing with the private players. So, the past began in that manner. For whatever reason, the GSM equipment was not bought in time. Hence, the BSNL lost ground on the GSM front. Further, being a 100 per cent government-owned company, we are entirely dependent on the government for major decisions," Shrivastava said. The panel noted some of the government decisions behind woes of telecom PSUs including forced payment for spectrum that was auctioned in 2010 without giving them any option. MTNL submitted that it has to pay Rs 11,100 crore for spectrum which overnight turned it into a debt-ridden company from a profit making company and 'Cash-rich' company. "We had to take a loan of Rs 7,500 crore loan from the bank. When the auction took place, MTNL had not participated in the auction. The spectrum was given to MTNL at a reserved price saying that whatever price will be determined in the auction, MTNL will have to pay it.That was literally 20 times more than that of what the reserve price was," MTNL submitted. It said that BSNL which operates across India except Delhi and Mumbai were required to pay Rs 8 per person per megahertz, Airtel paid Rs 80 per person per megahertz and MTNL paid Rs 160 per person per megahertz. Panel also noted MTNL pension dues pending with the government. "In MTNL, the pension bill of employees accumulated to Rs 10,900 crore for which the Government has to step in due to the weak financial position of the company. However, the liabilities have not been settled in the last four years despite the government decision to pay it in January, 2014," the panel said. It also discussed merger of BSNL and MTNL and recommended government to cautiously analyse all the factors before taking any decision on the merger of two CPSUs, particularly in the context of merger of two biggest loss making CPSUs, MTNL and BSNL whose combined financial liabilities during 2016-17 was a whopping Rs 24,038.73 crore the combined manpower of both PSUs is a staggering figure of 2,24,367 persons. "Also various procedural lapses have been pointed out in the case of MTNL and BSNL by C&AG of India," the panel said. PTI PRS MKJ


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