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BSNL May Induct a Foreign Partner

29 June, 2009

State owned telecom operator, Bharat Sanchar Nigam Limited (BSNL) is looking at inducting a foreign telecom operator as a strategic partner, reports PTI. The move is expected to raise more funds for the PSU than other options such as listing or disinvestment.

BSNL, which has a paid up capital of around $1,04 billion is valued at $100 billion. It reported a decline in both, total income as well as net profit this year. The main reason for this decline in its figures is the low average revenue per user (ARPU). It had reported revenues of Rs 38,000 crore and net profit of Rs 3,000 crore in the last fiscal. BSNL has a subscriber base of around 50 million and the company is expecting to add 1 million users in June 2009.

The coming in of a foreign partner is expected to change the culture and the working of BSNL as the foreign partner would also have a say in the management of the company.

Many foreign telecom players like AT&T, France Telecom and others are also mulling an India foray. These companies are also in talks with various private sector telecom companies for entering the Indian markets. BSNL can also look at this option for inducting a foreign partner, the report says.

BSNL also launched its 3G services in February this year. Currently, it offers 3G services in 70 cities and has about 9,000 3G subscribers. The company is targeting a customer base of one lakh users for its 3G services over next 3 months. It also plans to expand its network to cover 1,000 cities by the end of this year.

BSNL’s 3G currently provides services like video calling, mobile TV and high speed internet. The company will expand its service offering by adding services like voice-on-demand (VOD), video streaming, games-on-demand and full track music download.

BSNL may soon get the status of a ‘Mahanavaratna’, which would confer it greater operational autonomy. It is expected to be one the few state owned companies to get the status. Other state run companies that may also get the status are Oil majors ONGC and IOC, steel-maker SAIL, and Coal India Ltd.


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BSNL May Induct a Foreign Partner

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