BSNL & MTNL Rs. 15,000 Crores revival package approved by MoF. Moreover, the Finance Ministry has approved issuance of a sovereign guarantee of Rs 15,000 Crores. Therefore, enabling BSNL and MTNL state run to telecom providers. In order to raise money by issuing long-term bonds. And restructure their existing debt.
The issuance of sovereign guarantee is part of the Rs 70,000-crore revival package announced by the government in October, 2019. “Sovereign guarantee of Rs 15,000 Crores as Rs 8,500 Crores to BSNL. And Rs 6,500 crore to MTNL. For restructuring of their existing debts. And meeting some capex requirements for launch of 4G services. The proposal has been examined in this department. And agreed to subject to the adherence of terms and conditions”. Hence, an office memorandum of department of economic affairs said.
“With the said (sovereign guarantee ) resources, BSNL and MTNL would restructure their existing debt and also partly meet Capex and Opex, and other requirements, the Cabinet’s October notification said.
The department of telecommunication (DoT) will review utilisation of the guaranteed funds to ensure that there is no risk of default. The government also said that the two PSUs would monetise their assets including land worth Rs 38,000 crore over a period of four years.
This move will give a huge relief to the state run corporations who can in-turn provide better services and increase customer base. Currently, Mumbai based Reliance Jio has the majority market share.
