BSNL; HOW TO DESTROY A PSU MADE EASY
From being a Navratna company in 2008 to a basket case today what has happened to Bharat Sanchar Nigam Ltd?
First there is the official version spread all over friendly media unwilling even to look at the truth; alright another version of the truth!
Fact : BSNL gave a soft loan worth ₹1500 to the Govt Of India through the Department Of Telecom
Fact : BSNL’s ₹ 1,50,000/ crore worth of assets are still with DoT; transfer them to BSNL and it will be a Navratna company again
Fact : Government of India owes BSNL ₹6500/ crore for various projects and other services rendered; pay the amount and BSNL does not need to look any further
Fact : BSNL is prevented from participating in the 4G auction; so unlike private players BSNL is unable to provide 4G services
Fact : BSNL is also proscribed from raising capital/revenue from the market whereas private players like JIO (₹ 1,50,000 crore) VODAFONE (₹ 1,25,000 crore) AIRTEL (₹ 1,15,000/ crore) have a free run
Fact : BSNL is bound hand and foot and is then expected to compete with the best of the best
Fact : BSNL has no level playing field…and is being hammered down by the powers that be
This raises the question; is BSNL being destroyed just as Air India was?
Remember AIR INDIA’s was one of the most profitable airlines in the world in the 70s and 80s
And in the 90s after private players came in precious bilaterals worth their value in Gold were quietly given to private airlines to the detriment of Air India
Air India (with Indian Airlines) connected and networked routes that were patently unprofitable commercially but absolutely necessary socially and nationally! Yet no one remember all that when successive managements of Air India are crucified by armchair analysts!
So is the case with BSNL…they networked the whole country, including terrorism affected J&K, Chattisgarh and the troubled North East…but Govt Auditors have never taken that into account!
*Now this is the Government backed and propagated view of BSNL’s sick state!
*Government-backed telecom companies — Mahanagar Telephone Nigam (MTNL) and Bharat Sanchar Nigam (BSNL) — will have to attract more customers towards their services or cut staff to address the growing financial crisis at the companies. BSNL failed to pay the salaries of its 1.76 lakh employees in February due to lack of funds. A similar situation has arisen at MTNL.
*According to a media report, BSNL only has 650 customers per employee, as against only 160 for MTNL. The former also has the highest number of employees among all the telecom operators in India.
*Private players lead in this respect. Vodafone Idea has 27,916 customers per employee and a 418.74 million customer base as of *December 31, 2018. It has only 12,000 people on its payroll. Bharti Airtel has a customer base of 340.25 million, managed by 16,962 staff members. Customers per employee are close to 20,000.
*BSNL uses 60 percent of its revenue in paying employee salaries. This is much higher for MTNL, which mainly operates in Mumbai and Delhi.
*A recent report by Kotak Institutional Equities said that in the past 14 years, BSNL has moved from ‘navratna’ to an ‘incipient sick’ public sector unit. “FY08 was the last year of positive operating profit (EBIT) for BSNL. Since then, the company has posted a cumulative FY09-18 EBIT loss of Rs 82,000 crore. This figure would have crossed Rs 90,000 crore by December 31, 2018,” it said.
*It added that employee expenses, including retiral benefit accruals, were 66 percent of operating revenue in FY18 as compared with 21 percent in FY06. With the intense competition in the telecom sector, BSNL has suffered a severe loss of jobs and market share over the past few years.
Now that’s the Big Govt, Big Money, Big Corporation view…and its a view made in tinsel town full of the greatest illusions ever…
However BSNL is not going down without a fight!
Not this time!