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BSNL, MTNL to Be Merged; Government Will Raise Rs. 15,000 Crores for Revival

BSNL, MTNL to Be Merged; Government Will Raise Rs. 15,000 Crores for Revival 4h5v1r

MTNL operates in Delhi and Mumbai while BSNL operates in rest of India and mostly in the hinterlands. 4q1w4a

By Indo-Asian News Service | Updated: 23 October 2019 18:50 IST

BSNL, MTNL to Be Merged; Government Will Raise Rs. 15,000 Crores for Revival

Highlights

Cabinet approved 4G spectrum allocation to BSNL and MTNL
The allocation of 4G spectrum would be done at 2016 prices
BSNL and MTNL will raise a sovereign bond of Rs. 15,000 crores

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The Union Cabinet on Wednesday approved the much-awaited 4G spectrum allocation to ailing telecom PSUs - BSNL and MTNL - and gave in-principle approval to their merger while allowing them to raise sovereign bonds of Rs. 15,000 crores for their revival. The allocation of 4G spectrum to them would be done at 2016 prices and istratively. 2k5m6d

"Ravi Shankar Prasad said at the briefing after the cabinet meeting.

Cut-throat competition and entry of Jio on free voice and cheap data prices led to consolidation in the Indian telecom sector with many small telcos shutting shop under losses and currently only Idea.

MTNL is listed but has its net worth already eroded. BSNL is unlisted. MTNL operates in Delhi and Mumbai while BSNL operates in rest of India and mostly in the hinterlands.

The PSUs' merger have been discussed many times earlier in the last 10 years but due to HR and listing issues, it never could be taken up. BSNL has an estimated loss of Rs. 14,000 crores in 2019 fiscal and MTNL has been in deep losses. BSNL is a 3G mobile player with sporadic 4G services on hotspots and on old 1900/2100 spectrum bands. It has 12 crore mobile subscribers and an 11 percent market share.

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