BSNL Commences Asset Monetisation Of Land Parcels Valued At Rs 20,000 Crore To Bail Out Of Current Financial Mess  

The state-run telecom major Bharat Sanchar Nigam Ltd (BSNL) has commenced the process of identifying land parcels all over the country for monetisation, which as per its internal estimate is valued at Rs 20,000 crore in 2018-19, IANS reported.

BSNL’s corporate office has circulated a list of land parcels which are proposed for monetisation through the Department of Investment and Public Asset Management (DIPAM) in the first instance.

The time-bound monetisation of land assets, mobile towers and fibre networks will help the financially bleeding firm earn some money in these tough times of falling revenues and rising losses.

Struggling with poor cash flows from services and a severe financial crunch due to a huge workforce of 1.76 lakh, BSNL is looking for non-core asset monetisation under the broad policy of the government where DIPAM is the nodal department.

For the last three years, BSNL’s total revenues (yes, revenues, not profits) have been falling continuously, from Rs 31,533 crores in 2016-17 to Rs 25,071 crore the following year and finally fell to Rs 19,308 crore last year.

Losses in 2018-19 are expected to balloon to over Rs 14,000 crore, which, interestingly is almost the same as its employee cost of Rs 14,488 crore. Employees eat up 75 per cent of gross revenues.

BSNL telecom factories at Mumbai, Kolkata, West Bengal, Ghaziabad, Jabalpur and wireless stations, as well as other offices and staff colonies, have been included in the list of land parcels to be monetised.

“The total area of land parcels, which are spread across the country and have in-built structures, buildings and factories, is 32.77 lakh square metres (sq m) and the spareable land parcel is 31.97 lakh sq m,” said an earlier BSNL corporate office letter to its circles seeking their comments.

“The valuation of these land parcels is proposed to be done along with the structures lying in the parcel after the in-principle approval for sale or long term lease by the government. The cost of buildings has not been included in the Fair Value of land parcels”, the letter added.

The government is proposing to spend a massive Rs 73,787 crore to revive BSNL, and its sicklier twin, Mahanagar Telephone Nigam Limited (MTNL) despite the fact that these are two of the whitest of white pachyderms in the government’s stable.

Telecom Minister Ravi Shankar Prasad assured Parliament the other day that he will make a “focused attempt” for “the revival of BSNL and MTNL”.

Several critics, however, argue that Rs 73,787 crore bailout will not be the last of the major investments needed. Example: the government is thinking of rolling out 5G services, and neither of its two white elephants can afford to stay out.

Under the current arrangement, BSNL and MTNL get spectrum allotted to them after the pricing is decided by private sector bidders in auctions. So, after the current bailout, several thousand crores more will be needed to pay for 5G spectrum.