Given the time lag in the return period, coupled with the fact that the same is yet to be approved, the short-term loan seems like the likely solution
In a letter to Prime Minister Narendra Modi, Bharat Sanchar Nigam (BSNL) employee’s union has sought a short-term loan of Rs 6,000 crore from the Centre, the Business Standard reports.
The Sanchar Nigam Executives Association (SNEA) has cited operating and capital expenditure and speedy revival of the public sector behemoth as reasons for the requirement. They also sought 4G spectrum allotment and a pension policy as per the Third Pay Commission, it added.
Moneycontrol couldn’t independently verify the report.
Meanwhile, BSNL’s land monetisation/leasing proposal from July 2018 is still in limbo. The letter suggests the bank loan could help ease operating burden until such time the land monetisation is approved by the Department of Telecommunications (DoT).
Land monetisation is being looked as a means of survival as the expectation is for immediate gains of Rs 1,000 crore, followed by Rs 3,000-4,000 crore over time. Post-approval, the Union estimates at least six months before the policy provides returns.
Given the time lag in the return period, coupled with the fact that the same is yet to be approved, the short-term loan seems like the likely solution.
The letter, signed by Union General Secretary Sebastin K states, "If the decision is delayed by another two to three months, it will be too late as BSNL network may deteriorate beyond repair and will make revival impossible."Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months at 289. Use code FREEDOM.