After completing a first full year in office, Indian Prime Minister Narendra Modi is now keen to revive the fortunes of struggling state-owned telecoms operators BSNL and MTNL.
Economic Times reports that Modi’s government sees “the revival of BSNL and MTNL as priority concerns”, citing quotes from the country’s telecoms minister Ravi Shankar Prasad.
India’s telecoms market remains highly competitive, with BSNL and MTNL struggling for market share in the face of competition from private players including Bharti Airtel and Vodafone India.
BSNL, which has a nationwide footprint, has struggled in recent years, and is operating at a loss of INR70 billion ($1.1 billion), a sharp decline from a decade ago when it posted profits of INR99.7 billion ($1.56 billion).
MTNL operates exclusively in Mumbai and Delhi, and has suffered an even more dramatic downfall. The company was in profit until 2008-2009, but had a debt of INR166 billion ($2.6 billion) when Modi’s government came to power last year.
“Someone, somewhere will have to take responsibility and accountability as to which were the forces and patronised by whom, responsible for creating a mess,” Prasad added.
Fingers will point to the previous UPA government, with Prasad claiming that BSNL was stopped from expanding for approximately six to seven years.
Reports suggest that tenders were stalled under security grounds to allow private players to gain more time in the bidding process.
The government is now working hard to make up for lost ground by expanding BSNL, and the ministry said it plans to install more than 25,000 new base stations in two to three years, with 15,000 already in place after year one.
MTNL is also building on its connectivity, with 1,080 3G site upgrades in Delhi and Mumbai, 825 2G site upgrades in Delhi, and upgrades to 616 2G sites in Mumbai.