Connecting BSNL Employees / Subscribers 4 Growth of BSNL: BSNL To Lose Mini Navratna Status

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BSNL To Lose Mini Navratna Status

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State-owned BSNL is set to lose some of its financial and functional autonomy as the Centre plans to strip the public sector company of its special status as a 'mini navratna'.
This comes as the PSU has recorded a whopping loss of 6,384 crore for the year-ended March 2011, capping a series of dismal results in the last four years that saw the erstwhile monopoly being reduced to a bit player in the fast growing market.

A mini-navratna company can place orders for projects and enter into joint ventures on its own without having to seek prior government approvals.
The department of public enterprises (DPE) had written to the telecom ministry last month seeking that the status of mini-navratna be withdrawn from BSNL. "The policy for mini-navratna that gives special powers to these company boards does not allow a loss-making company to qualify," a senior ministry official said.
The telecom department in turn has requested the DPE to "go slow" on the issue as it would "affect the morale and investment climate" this official added.
The DPE is expected to move a Cabinet note on the matter, as the decision to disqualify a PSU from this special status requires government approvals at the highest levels.
BSNL saw its overall revenue fall from 39,715 crore in 2006-07 to 38,053 crore in 2007-08 and further to 35,812 crore in 2008-09, before falling to 32,046 in 2009-10.
The telco finished the year-ended March 2011 with revenues of 29,687 crore. Its fall from grace is best explained from the fact that its annual revenues were over the 40,000-crore mark for the year-ended March 2006.
A top BSNL executive admitted that the company could lose its special status. Ironically, BSNL was pushing for an upgrade from a mini-navratna to a full navratna just a couple of years ago.
In December 2011, BSNL's chairman and managing director RK Upadhyay had told ET that the primary reason for telco's slide was that it had been unable to place any orders for mobile networks since 2006 as each of its tenders were cancelled after companies that lost the bids mounted legal challenges against the PSU. Private mobile operators have added over 700 million cellular connections during this period.


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