In an SOS Letter to the Government, BSNL seeks funds for survival

BSNL_news | BSNL seeks funds for survival | Business magazine in India

The crisis at State-run telecom operator BSNL is deepening with each quarter. In an SOS letter sent to the Government, BSNL has asked for immediate fund infusion as it has become nearly impossible to run the operations. Right now, it is staring at a liability amounting to Rs 850 crore in terms of salary to its employees and Rs 13000 crore in business terms.
The gap between monthly revenues and bare expenses to continue operations as a going concern has reached to a level where continuing with the BSNL operations would be nearly impossible without immediate infusion of adequate equity,” Puran Chandra, senior general manager at BSNL’s corporate budget and banking division, said in a letter to the joint secretary in the telecom ministry. BSNL is currently India’s top loss-making PSU with an accumulated operating loss crossing over Rs 90,000 crore at the end of December 2018 as in the Kotak Institutional Equities report. The company has not reported a net profit since 2008-09. Excessively high employee costs, poor management functioning, and delays in modernisation plans have been highlighted as the root cause of the present ailing condition.
Earlier there were talks of restructuring of BSNL according to several media reports in order to strengthen it. But, so far, the government has failed to provide any revival road map. It has also refused to close it down, citing the company’s “strategic” importance. In the letter, sent last week, the telco has sought the government’s advice on the next “course of action” for deciding its fate.  BSNL’s chairman had made a presentation to the government a few months back about the ailing condition of the company. However, no clear solution has emerged as to how the company will survive.

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