Government forms panel to take off BSNL and MTNL, okays Rs 23k crore bailoutNEW DELHI: The Centre has constituted a panel of ministers tasked with looking at ways to revitalise the two public sector mobile phone companies - BSNL and MTNL.
Currently, an empowered group of ministers (EGoM) headed by finance minister P Chidambaram looks into all spectrum-related issues for the telecom sector. It is not known if Chidambaram will head the new Group of Ministers (GoM) too. This panel will take a call on the telecom department's demand that Cabinet approve Rs 23,000 crore bailout for BSNL and MTNL.
The other members of this panel include telecom and IT minister Kapil Sibal, commerce and industry minister Anand Sharma, planning commission deputy chairman Montek Singh Ahluwalia, information and broadcasting minister Manish Tewari and the minister of state for personnel, public grievance and pensions V Narayanasamy. Besides, Narayanasamy is also the representative from the Prime Minister's Office in this panel.
"The GoM will, keeping in inter alia in view national and strategic interest, consider and recommend measures that could be taken in the short, medium and long term for revival and revitalisation of BSNL and MTNL," said the official note from the Cabinet Secretary, on the formation of this panel. The group of ministers will have to finalise their recommendations in three months time, the note added.
Last month, Sibal had asked prime minister Manmohan Singh to constitute a panel of ministers who would come up with a strategy to revive the two public sector units. Sibal in his communication to the PM had said that while results for 2012-13 were yet to be declared, he expected MTNL's networth to be completed eroded and added that BSNL was expected to declare a loss of Rs 10,000 crore during the same period.
"Due to change in business environment and hyper competition in the telecommunication market, the financial position of BSNL and MTNLBSE 2.01 % had deteriorated in the last 3-4 years. Unless immediate steps are taken to revive and revitalise these PSUs, they would turn sick shortly," Sibal had said.
BSNL, which offers services in all regions except Mumbai & Delhi had registered a loss of BSNL, which offers services in all regions except Mumbai & Delhi had registered a loss of Rs 8,851 crore in 2011-12 and MTNL about Rs 4,110 crore during the same period.