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Saturday, 19 July 2014

Merger of loss making MTNL with BSNL: Rajya Sabha Q&A

Merger of loss making MTNL with BSNL: Rajya Sabha Q&A

 GOVERNMENT OF INDIA
MINISTRY OF  COMMUNICATION AND INFORMATION TECHNOLOGY
RAJYA SABHA

QUESTION NO  1108

ANSWERED ON  18.07.2014

Merger of loss making MTNL with BSNL
1108 SHRI ANIL DESAI

Will the Minister of COMMUNICATION AND INFORMATION TECHNOLOGY be pleased to satate:-
(a) whether it is a fact that both MTNL and BSNL are making losses;

(b) if so, the profit/loss status of these PSUs during the last three years;

(c) whether there is any proposal for merger of these two PSUs, if so, the details thereof;

(d) whether views of workers' unions of these PSUs are also taken into consideration to obviate any financial loss to them; and

(e) whether the merger envisages profits to these companies?

    ANSWER

THE MINISTER OF COMMUNICATIONS AND INFORMATION TECHNOLOGY & LAW AND JUSTICE (SHRI RAVI SHANKAR PRASAD)

(a) & (b) Yes, Sir, Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited have been making losses. Details of their profit/losses during the last three years are given below:
(In Rs. Crores)

Year            BSNL          MTNL
2011-12      (-) 8,851     (-) 4110
2012-13      (-) 7,884     (-) 5321
2013-14     (-) 7,085 *     7825**

* Unaudited and provisional
** MTNL has shown a profit of Rs. 7825 crore mainly due to write back of provisions on account of pensionary liabilities and spectrum amortization costs after decisions of Government taken for revival of MTNL.

(c) to (e) Government is in the process of revival and revitalization of Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) through various short term, medium term and long term measures.

The long-term measures, including merger of BSNL and MTNL, would attempt to position these PSUs to emerge as market leaders in the converged telecommunication market. For an in-depth study on the implications of merger of the two PSUs, three groups have been constituted to study issues of human resources integration, technology integration and corporate integration.

Views of unions on merger would be taken into consideration before a decision is taken in best public interest and that of two companies.

Source: Rajya Sabha
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