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Will this be the next sorry story?

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BSNL India logo

When Air India was gutted and became a sinkhole for our tax money, the press did not ask the questions which should have been asked. Will IE‘s report on BSNL die a similar unremarked death? Here it is:

State-owned BSNL, which once aspired to become a Navratna company, today has money just enough to survive for another year.

An integrated telecom service provider, which got off to a flying start in 2000, began running into problems since 2007 due to delays in placing orders for equipment. The PSU, which had a Rs 30,000-crore cash surplus a year ago, has already depleted these reserves by 83% to Rs 5,000 crore owing to stagnant revenue and rising expenditure. The cash surplus had enabled the company to survive without any government bailout and pay Rs 18,500 crore last year for the 3G and broadband wireless spectrum.

BSNL is expected to post losses of around Rs 4,000 crore at the end of fiscal 2010-11. On the revenue side, its income is estimated to fall by 12.5% to Rs 28,000 crore. When contacted, BSNL CMD Gopal Das declined to comment. After meeting its monthly expenditure, it has a deficit of around Rs 300-Rs 400 crore each month for which it dips into cash reserves.

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Written by Arhopala Bazaloides

February 16, 2011 at 8:30 am

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