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Lacking government support, BSNL plans to monetise fibre network

The company is conducting an internal assessment and audit to monetise its fibre assets, estimated to be worth Rs 50,000 crore.

, ET Bureau|
Apr 18, 2019, 11.22 AM IST
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Agencies
BSNL
BSNL is expected to narrow its loss slightly to Rs 7,500 crore in FY2019 from Rs 7,900 crore a year ago.
Bharat Sanchar Nigam Ltd (BSNL) is thinking of leasing out its vast optic fibre cable network to private players as it seeks to fund a voluntary retirement scheme and regular expenditure in the absence of monetary support from the government.

BSNL chairman Anupam Shrivastava did not divulge details of the plan, but said the entire exercise could take two to three months before the matter is passed on to its board for consideration.

The company, based on a government advisory, is conducting an internal assessment and audit to monetise its fibre assets, estimated to be worth Rs 50,000 crore.

The leasing out of dark, or unused, optic fibre cable (OFC) to private players could fund the Rs 6,500-crore VRS scheme, enable it to buy spectrum in the absence of administrative allocation and help it become debt-free. BSNL has the lowest debt level in the industry, at Rs 14,000 crore.

The cash-strapped service provider spends nearly 70% of revenue towards meeting salary expenses of its 1.76 lakh direct workforce.

BSNL has the largest fibre-based telecom network — nearly 7.5 lakh route kilometres — among the four telecom operators in the country.

Billionaire Mukesh Ambani-owned Reliance Jio has 3.25 lakh route km, including the 178,000 route km it acquired from younger brother Anil Ambani’s Reliance Communications. Bharti Airtel has 2.5 lakh route km, while Vodafone Idea has 1.6 lakh km of fibre spread across the country.

All three private carriers are all looking to monetise their respective fibre assets to reduce debt.

BSNL should first sell its fibre assets and then lease-back, said Sandeep Aggarwal, co-chairman, Telecom Equipment and Services Export Promotion Council.

“Private companies can use BSNL’s robust fibre-based network to go to rural areas for 4G expansion,” Aggarwal said, adding many global asset management companies could show interest in acquiring the company’s fibre assets.

BSNL is expected to narrow its loss slightly to Rs 7,500 crore in FY2019 from Rs 7,900 crore a year ago. Revenue is expected to fall to nearly Rs 23,000 crore from Rs 25,000 crore in the financial year 2018, on intensifying competition and declining average revenue per user.
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