IndiaCatalog.com
India News
Search Web Directory
News Home
Govt approves BSNL-MTNL merger, clears Rs 70,000-crore relief package
Posted on 24th October 2019
Just days before Diwali, the government has taken a decision to lift the air of uncertainty over the two public sector telecom behemoths — Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL). While approving a package of nearly Rs 70,000 crore for the two financially stressed entities, the Union Cabinet on Wednesday also drew up a timeline to merge them. Monetising real estate assets worth Rs 37,500 crore is part of the overall relief package that would be used to retire debts, upgrade networks and offer a voluntary retirement scheme (VRS) aimed at reducing the companies’ employee strength by half.

The government has said that the two companies are strategically important and will not be closed down or disinvested. Recent reports had suggested that some key ministries were of the view that the revival of BSNL and MTNL was not feasible, and that they could be shut down. Briefing the media after the Cabinet decision, Telecom Minister Ravi Shankar Prasad categorically said the government was neither closing down, nor divesting its stake in, BSNL and MTNL.

The relief package includes a sovereign bond issue worth Rs 15,000 crore, to be serviced by the two telcos. Also, BSNL and MTNL will be allotted 4G spectrum at an administered price, pegged at the 2016 auction value. The two firms would be allotted 4G spectrum worth Rs 20,140 crore, Rs 29,937 crore for VRS covering 50 per cent of their employees and Rs 3,674 crore for goods and services tax (GST) that will be levied on allocation of radiowaves. Details of the VRS scheme will be finalised by the two firms.

The ex-gratia component of VRS, to be offered to employees aged 50 years and above, will require Rs 17,169-crore budgetary support. Another Rs 12,768 crore will be towards preponement of pensionary benefit. Giving an instance of how the scheme will work, Prasad explained, “the VRS package approved by the Cabinet will give eligible employees 125 per cent of the income they would have earned by serving the company till the age of 60 years.” The minister said, “with this decision, we have taken care of the interest of lakhs of employees of these PSUs.” BSNL has around 1,76,000 employees and MTNL workforce is at 22,000.

Private telcos are estimated to spend 5 per cent of their total expenditure on staff cost, while for BSNL and MTNL it works out to 70 per cent of the total.

On asset monetisation to be spread over three to four years, Saurav Kumar, Partner, IndusLaw, said, “if the company plans to do a slump sale of such land banks at book value into a separate company along with the liabilities, they may have to show the real estate asset as a separate business undertaking.’’ Also, as India gears up up for the 5G launch, it may become challenging for BSNL and MTNL to break even on the price they will be expected to pay for the new 4G spectrum, he added.

Telecom Secretary Anshu Prakash said the spectrum will be allocated to both the companies administratively within a month. BSNL will also need around Rs 10,000 crore to roll out 4G services in phases and MTNL an estimated Rs 1,100 crore. “The spectrum allocation to BSNL worth Rs 14,115 crore will be in lieu of equity shares and about Rs 6,295 crore for MTNL in lieu of preferential shares,” Prakash said. On monetisation of real estate, Prasad said assets worth Rs 38,000 crore had been shortlisted. The assets primarily include land as well as rental and leasing of buildings. MTNL has around 29 retail outlets in Delhi alone.

Related Companies: Bharat Sanchar Nigam Limited (BSNL)   

Other Latest News
Gold prices steady at Rs 52,701 per 10 gram, silver rises to Rs 67,439 a kg
Posted on 14th August 2020
Gold prices on Friday was recorded at Rs 52,701 per 10 gram on subdued global cues and weaker dollar while silver prices rose to Rs 67,439 from Rs 66,256 per kg, according to Indian Bullion and Jewellers Association. The yellow metal has witnessed sharp volatility in the market as experts chart its direction after a massive slump from recent highs.

Gold jewellery prices vary across India, the second-largest consumer of the metal, due to excise duty, state taxes, and making charges.

Oil prices head for second weekly gain amid hopes for fuel demand recovery
Posted on 14th August 2020
Oil prices advanced on Friday and were heading for a second week of gains amid growing confidence that demand for fuel is starting to pick up despite the coronavirus pandemic that has slammed economies worldwide.

Brent crude was up 14 cents, or 0.3%, at $45.10 by 0043 GMT, heading for a gain of about 1.6% this week.

Hyderabad-based Biological E joins hands with J&J for Covid-19 vaccine
Posted on 14th August 2020
Hyderabad-based pharma company Biological E Limited (BE) has entered into an agreement with Janssen Pharmaceuticals for the development and manufacturing of Covid-19 drugs as well as Johnson &Johnson's (J&J) Covid-19 vaccine candidate.

The vaccine candidate is in phase 1/2a clinical trials.

Amazon enters online pharmacy space in India; to compete with Netmeds, 1mg
Posted on 14th August 2020
E-commerce giant Amazon has forayed into the online medicine segment and launched Amazon Pharmacy. The service has been started in areas with select pin codes in Bengaluru, while the company is learnt to be mulling scaling it up to other cities across India in the near future.

The service would allow customers to order prescription-based medication in addition to over-the-counter medicines, basic health devices and Ayurveda medication from certified sellers.

Bengaluru violence: 60 more including Congress corporator's husband arrested
Posted on 14th August 2020
A total of 60 more arrests have been made by the Bengaluru Police in connection with the violence that broke out in the city on August 11, taking the total number of arrests in the incident to 206. Among the new arrests is Kaleem Pasha, husband of Congress corporator from Nagwara ward Irshad Begum.

Pasha is said to have close political links with both the Congress party and SDPI.

» Post a FREE Classified Advertisement
Inviting Real Estate Agents, Job Placements Agents, Educational Institutes, Software Service Providers, Real Estate Builders, Marriage Bureaus, Travel Agents, Restaurant Owners, Health & Fitness Centers and other Local Businesses to Post a FREE Classified Advertisement on Cootera.com Classifieds Website.
Jobs in India India Real Estate Automobiles Matrimonials Beauty & Fitness

Add a comment for Govt approves BSNL-MTNL merger, clears Rs 70,000-crore relief package
Please only use this form to enter comments on the above company. All comments are reviewed before they are displayed on the web site. Not all comments may be displayed. Check back with us to see if your comments have been displayed.
If you want us to email the comments posted by users, please Subscribe by email
Name*
Comments*
Security Code*
 

Be the first person to write a business review for Govt approves BSNL-MTNL merger, clears Rs 70,000-crore relief package

Most Read News

Gold prices at Rs 59,300 per 10 gm, silver jumps to Rs 74,210 a kg

Kerala plane crash: Air India praises Malappuram residents for saving lives

US President Trump follows India's footsteps with TikTok ban

Russia to start producing COVID-19 vaccine within 2 weeks

US election: China would love to have me lose to 'sleepy' Biden, says Trump

More India News

  India Web Directory
Business Profiles
Automotive Directory
IT/ITES/BPO Directory
Hotel Directory
Health Directory
Business Directory
Gems & Jewellery
Education Directory
Real Estate Directory
Agriculture Directory
Logistics Directory
Yellow Pages
NRI Guide
Photo Galleries
Global Web Directory
*** FREE India Classifieds
Order Premium Listings
Submit a Site
Business Reviews
Home
About us
Link to us
Advertise
Contact us
Google Search Keywords: India Catalog, IndiaCatalog, India Web Directory
    © 1999 - 2020 IndiaCatalog.com
    All Rights Reserved
Privacy Statement