Once powerful BSNL is in red and does not have money to pay the salaries to its employees. The BSNL is now with a begging bowl is in front of Government seeking Rs 850 crores for giving salaries of June.
The BSNL has nearly Rs 13,000 crore as outstandingliabilities that have made running the business difficult.
"The gap between monthly revenues and bare expenses tocontinue operations as a going concern has reached to a level where continuingwith the BSNL operations would be nearly impossible without immediate infusionof adequate equity," Puran Chandra, senior general manager at BSNL'scorporate budget and banking division, stated in a letter to the jointsecretary in the telecom ministry (who also sits on the board of BSNL).
With Jio, Airtel, Vodafone steam rolling over the customer base, the mighty BSNL is gasping for survival as the Reliance Giga is being unrolled to tale away from the broadband fixed line customers too from the BSNL.
The state-owned telecom firm had failed to pay the Februarysalaries to around 1.76 lakh employees due to its financial crisis. This wasthe first time the company had defaulted in payment of its monthly salaries.
The fully government-owned corporation is undergoing a majorcash crunch due to the price war with private companies. According to a reportby Kotak Institutional Equities, the accumulated operating losses of BSNL weremore than Rs 90,000 crore at the end of December 2018.
Meanwhile, the government has not only failed to ensure anyrevival road map for the company, it rather rejected any suggestions of closingdown the company citing BSNL's "strategic" importance, the reportsaid.
BSNL's chairman had also given a presentation to PrimeMinister Narendra Modi a few months back but no final decision was taken on howthe company would survive.
This is noteworthy that the telecom sector has been batteredby falling tariffs, eroding profitability, and towering debt, in the face ofstiff competition triggered by disruptive offerings of Reliance Jio, owned byrichest Indian Mukesh Ambani.
