The department of telecommunications (DoT) plans to support the loss making BSNL and MTNL by giving an annual subsidy of about Rs. 30bn to sustain their operations.
According to reports, the subsidy amount to BSNL will be given to support its operations in rural and far-flung areas from the Uuniversal Service Obligation Fund (USOF), while MTNL will be given support for its higher pension and other retirement payouts from the licence and spectrum fee, which both PSUs give to the government.
The DoT suggests that BSNL incurs a loss of about Rs. 20-25bn from its landline business, majority of which are social commitments in rural and far-flung areas and MTNL’s pension amount stands at Rs. 3-3.5bn annually.
However, DoT has asked BSNL to quantify the exact amount of loss it incurs due to its social obligations. DoT plans to implement this proposal by this year, adds report.
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