Once the Raja of India?s telecom market, the state-owned BSNL is a pale shadow of itself today. It ceased to be the largest player in the telecom market many years ago, and telcos like Bharti Airtel and Vodafone beat it even in terms of subscribers in rural areas some years ago. Today, as FE reported on Tuesday, BSNL probably has a year to live. It has been making losses over the past few years, but managed to stay afloat thanks to the interest earnings on its Rs 30,000-odd crore of cash reserves. Today, with the losses mounting, the company has been dipping into its reserves by around Rs 400 crore each month ? reserves are down to Rs 5,000 crore, enough for a year or so.
The government knows BSNL is on its last legs. It even set up a committee under Sam Pitroda to fix things, to offer solutions beyond those offered by BSNL?s management ? allow us to buy more equipment, and that?ll fix the problem. Pitroda suggested a far more dramatic plan ? this included separating the post of chairman from the managing director who would be a professional, ending the current tendering system and going in for a Bharti Airtel-style system of outsourcing of network management to firms like Ericsson and Nokia, large VRS and listing of the firm. It?s been a year since, but little has happened on the Pitroda report. Raja, it appears, was busy with his spectrum scam; Sibal, it is obvious, is preoccupied with putting out the Raja fire. Where that leaves BSNL is equally clear ? in a year?s time, outside BIFR?s door.