Merging BSNL and MTNL Could Take Longer Than One Year: Report

Both the public-owned telecom operators have been unable to manage their business with revenues hard to come by.

BSNL headquarters in Delhi.

(Photo: IANS)

Merging country’s two of the biggest public-owned telecom entities is reportedly going to take longer than one imagined.

We’re talking about the Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL), that are going through financial stress, as most of the Indian telecom sector grapples under the pressure of operators looking to compete with Reliance Jio with low data plans and free voice calls.

Senior telecom executives at BSNL, quoted this ET Telecom report claim the merger is unlikely to go through before 2021, as the government chalks out a clear strategy to keep both the entities running.

For this, the Centre needs required approvals from the cabinet for the merger, which is likely to help on the financial side for both BSNL and MTNL to sustain in such a competitive environment.

Basic issues like cross payment between the operators can be removed with the planned merger, and also roaming service for the customers gets a clear channel, which improves the performance of the network as well.

Biggest challenge for the telcos is to balance out the inequality between the wages paid to the employees and the revenue the companies have been making over the past few years.

BSNL caters to more employees than MTNL and bringing all this workforce into a unified entity will also take a lot effort, which the government clearly seems to be willing to take, as they don’t want either of these entities to shutdown.

Merging both these telcos, according to the government, will help them in competing with private telcos in the country, and giving them the impetus to attract users with new set of data plans and better service.