BSNL-BBNL Merger 2022: The Union Cabinet chaired by Prime Minister Narendra Modi approved a revival package of Rs 1.64 lakh crore for BSNL on July 27, 2022. The revival measures focus on infusing fresh capital for upgrading BSNL services, de-stressing its balance sheet, allocating spectrum and augmenting its fiber network by merging with Bharat Broadband Nigam Limited (BBNL).
Union Communications Minister Ashwini Vaishnaw shared during the press briefing after the cabinet meeting that the presence of BSNL in telecom market acts as a market balancer and plays a crucial role in expansion of telecom services in rural areas including development of indigenous technology and disaster relief.
The BSNL revival plan not only includes helping BSNL improve the quality of its existing services but roll out 4G services and become financially viable. BSNL is expected to report a turn-around and earn profit by Financial Year 2026-27 with the implementation of the revival plan.
"Union Cabinet approves the Rs 1.64 lakh crore revival package for BSNL," says Union Minister Ashwini Vaishnaw pic.twitter.com/MoxMHuBFv0
— ANI (@ANI) July 27, 2022
BSNL Revival Plan
BSNL BBNL Merger
The Bharat Broadband Network Ltd (BBNL) will be merged with BSNL to facilitate wider utilization of infrastructure laid under BharatNet. The infrastructure created under BharatNet will continue to be national asset and accessible on a non-discriminatory basis to all the Telecom Service Providers.
Upgrading BSNL services
BSNL will be allotted 900/1800 MHz spectrum band at a cost of Rs 44, 993 crore to improve existing services and provide 4G services to enable it to compete in the market and provide high speed data using their vast network including in rural areas.
The government will also fund capex worth Rs 22,471 crore to support BSNL in meeting its projected capital expenditure for next four years. This will not only promote indigenous technology development but also provide a significant boost to development and deployment of Atmanirbhar 4G stack.
The government will also provide Rs 13,789 crore to BSNL as viability gap funding for commercially unviable rural wire-line operations done during 2014-15 to 2019-20.
The authorized capital of BSNL will also be increased from Rs 40,000 crore to Rs 1,50,000 crore in line with AGR dues, allotment of spectrum and provision of capex.
De-stressing BSNL balance sheet
The central government will provide sovereign guarantee to BSNL and BBNL for raising long term loan to help restructuring existing debt and de-stressing the balance sheets. They will be able to raise these bonds for an amount of Rs 40,399 crore.
The centre will also provide funds to BSNL for settling the AGR/GST dues, which amount to almost Rs 33,404 crore.
The BSNL will also re-issue preference share worth Rs 7,500 crore to the central Government.
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