Our cover story this edition is based on datasets of performance and government funding. This concerns two telcos - one state owned, BSNL and the other Vi, private in name, statist in equity. The findings are disconcerting. There are endless downward spirals and concentric demands for funds, waivers and the like. More of the vicious cycle syndrome.
Take the case of Vi. The government bought its debt of Rs 53,183 crore for 49 per cent equity without any management control which is vested in the two minority promoter shareholders, namely – UK based Vodafone and Kumar Mangalam Birla owned entities.
Now again, Vi is before the government for financial relief. Various arguments are being advanced to secure this. If Vi folds up, the central government will be left holding the can of outstanding dues. The duopoly prevention argument is always thrown in for good measure. The issue of bankruptcy is drummed up if there is an insistence on meeting liabilities.
Thus, various arrangements are being discussed to give a further relief on regulatory dues of Rs 84,000 crore. Then there is a spending spree based on lending for network expansions. And of course the lead bankers in negotiations are public sector banks. A loan of Rs 25,000 crore for 10 years is on the cards. For performance stats, Vi continued with its downward trend and as per the latest figures available from May, it lost 274,103 subscribers.
As for BSNL, the descriptor, ‘ventilator support’ seems to have stuck and become its management practice. Its slide seems to be in perpetuity. For the reported month, BSNL's subscriber base fell by 1.35 million. Almost like a scene from the tragicomedy, Madhya Pradesh (MP) Police pressed the disconnection button and ported to Airtel. MP is the state from where the union communications minister, Jyotiraditya Scindia hails. MP Police reasons’ for exit were: Communication inefficiency and inability to match the evolving demands of modern policing. When the government departments express no confidence in BSNL operations, why will private citizens become its subscribers?
