BSNL asked to choose between shut down or revival, to lay off over 50k employees

Government-owned telecom service provider Bharat Sanchar Nigam Limited (BSNL) has been asked to choose between revival or shut down over its mounting losses.

After meeting with top BSNL officials, the govt asked the telco to present a comparative analysis of all options available including shutting down in case of no revival plan in place.

The company, apart from the competition from private players who have most of the telecom market share, is also asked to think over a plan to counter losses. BSNL is mulling to reduce the workforce, either through a VRS or by bringing down the retirement age from 60 years to 58 years.

It is reportedly planned to reduce its ageing workforce by over 50K, out of 174,312 workers it has employed, by reducing the retirement age to 58. The average age of BSNL workforce is above 55 years.

As per the suggestions by a senior committee of DoT, in this regard, BSNL if implement this, will save a total of Rs 13,895 crore over the next six years.

The state-owned telco had accumulated losses of Rs 31,287 crore at the end of 2017-18. The telecom income has come down consistent in last three fiscals. From Rs 32,411 crore in 2015-16 to Rs 27,818 crore in 2017-18, it has been on slipping downward.

In total PSUs losses, BSNL contributes about 25 per cent alone. BSNL landline business has also been impacted by cheaper mobile tariffs.

Meanwhile, the telecom services provider has received an interim report of the three-member committee tasked with the turnaround of the loss-ridden company.

To cut down mounting losses, the company is also planning to monetise land-bank and buildings holding, which is estimated to be worth Rs 15,000 crore.

According to the last TRAI report, all the other telecom operators witnessed downfall in their customer base except Reliance Jio. Idea was the biggest loser along with Vodafone. Both the firms together lost 66 lakh mobile customers.

Airtel was the third highest loser with a decline of 23 lakh mobile customers followed by Tata and BSNL, which lost over 10 lakh and 5 lakh customers respectively, said the report.

In terms of mobile or wireless market share, BSNL grabs merely 9 per cent.