BSNL gets R1,500-crore subsidy for landline ops

Written by fe Bureau | New Delhi | Updated: Dec 12 2012, 08:10am hrs
The highest decision- making body in the department of telecommunications (DoT), the telecom commission, on Tuesday approved a subsidy of R1,500 crore to BSNL for supporting its landline operations in rural areas.

The support for BSNL for the first year has been agreed upon and certain other information has been sought from them, the commissions chairman and DoT secretary R Chandrashekhar said.

He added that subsidy worth R1,500 crore has been approved by the commission out of a total proposed subsidy of R2,750 crore by the Telecom Regulatory Authority of India (Trai) for supporting rural landline connections installed before April 1, 2002.

The approval comes after Trai, following a request by BSNL, recommended a subsidy of Rs 2,750 crore for two years including R1,500 crore for the first year and R1,250 crore for the second year.

Though the commission also discussed the sale of 30% equity of Telecommunications Consultants India (TCIL) in Bharti Hexacom, it didnt arrive at a conclusion on the matter.

The Bharti Hexacom matter was not put up for decision but for the sake of information only. Some more information has been sought and broad direction has been given for some more work which needs to be done for arriving at suitable valuation, he said.

According to Deloitte, a 30% stake of TCIL in Bharti Hexacom was valued at R1,800 crore in 2009. Bharti Hexacom, a joint venture between TCIL and private telecom operator Bharti Airtel, provides mobile services in the Rajasthan circle.