BSNL and MTNL, two state-run telecom operators, will lose the data market, if they are not given 4G services soon. To compete and survive in the telecom market, the Committee feels that 4G spectrum should be given to them at the earliest, the committee, chaired by BJP MP Anurag Singh Thakur, said in its report tabled in Parliament.
MTNL and BSNL submitted proposals for allotment of spectrum with government support for launching 4G services in the telecom circles.
BSNL operates in 20 telecom circles of the country while MTNL has operations in remaining 2 telecom service areas of Delhi and Mumbai.
Telecom operators such as Bharti Airtel, Idea Cellular, Vodafone and Reliance Jio are active in the Indian 4G market.
BSNL and MTNL have requested for 5 MHz block of radiowaves in 2100 MHz band in the service area and the proposal is under consideration of the Department of Telecom (DoT).
Telecom minister Manoj Sinha has declared on the floor of the House that India government is going to take a final decision in the 4G spectrum matter and the telecom department is actively considering giving 4G spectrum.
It is also expected that allotment of 4G spectrum to BSNL and MTNL against equity infusion will contain their negative growth in the wireless and broadband segments.
The panel noted MTNL is under severe debt burden. The outstanding debt of MTNL is Rs 16,870.40 crore as on December 2017. BSNL has a debt of Rs 9,000 crore.
The projected revenue BSNL is Rs 28,500 crore and expenditure will be Rs 35,850 crore for the year 2018-19.
The panel asked government to consider voluntary retirement scheme submitted by the PSUs at the earliest to help them improve their cash flows.
MTNL incurs more than 76 percent of the revenue on staff cost as opposed to 4 to 6 percent by private sector.
Revival of MTNL will involve significant reduction in staff cost. Granting of VRS to 5,312 employees, i.e., 20 percent of the staff retiring in next 10 years is expected to reduce staff cost by 20 percent improving negative cash flow.