New Delhi: The government on Wednesday decided to merge loss-making public sector telecom firms MTNL and BSNL as part of a revival package that includes raising sovereign bonds, monetising assets and voluntary retirement scheme (VRS) for employees.
Briefing reporters on decisions taken by the cabinet headed by Prime Minister Narendra Modi, telecom minister Ravi Shankar Prasad said the government will infuse Rs 29,937 crore for the revival of the two telecom companies.
Till the time of the merger, MTNL will act as a subsidiary of BSNL.
The revival package includes raising of Rs 15,000 crore in sovereign bonds and monetising Rs 38,000 crore of assets over the next four years.
Voluntary retirement would be offered to employees to cut cost, he said. All employees above the age of 50 will be offered “attractive” voluntary retirement schemes (VRS). The minister said any employee older than 53-and-half-years who opts for the VRS will be given 125% remuneration of the salary, pension and gratuity till the age of 60.
According to the Economic Times, Prasad also announced that the 4G spectrum would be allocated to both the companies. BSNL, which is yet to pay employee salaries, has a monthly bill of Rs 850 crore and has a staff 1.76 lakh. MTNL has around 22,00 employees. Both the companies had failed to pay their employees their salaries for July.
“It is expected that with the implementation of said revival plan, BSNL and MTNL will be able to provide reliable and quality services through its robust telecommunication network throughout the country including rural and remote areas,” the Press Information Bureau said in a release.