Lok Sabha Question No. 2990 (UNSTARRED), answered on 2020-03-11
Subject: Market Share of Public Sector TSPs
Ministry: COMMUNICATIONS
Asked by: Magunta Sreenivasulu Reddy

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK  SABHA UNSTARRED QUESTION NO. 2990 TO BE ANSWERED ON 11 TH  MARCH, 2020

## MARKET SHARE OF PUBLIC SECTOR TSPS

## 2990. SHRI MAGUNTA SREENIVASULU REDDY:

Will the Minister of COMMUNICATIONS be pleased to state:

- (a) whether the Government-owned Telecom Service Providers (TSPs), i.e., Bharat Sanchar Nigam  Limited  (BSNL)  and  Mahanagar  Telephone  Nigam  Limited  (MTNL)  are  unable  to compete with their private counterparts and losing their market share due to which existence of both  these  companies  is  in  danger,  and  if  so,  the  details  thereof  and  the  reaction  of  the Government thereto;
- (b) the  reasons  for  Government  owned  TSPs  incurring  losses  whereas  private  TSPs  are earning crores of rupees every year along with the reaction of the Government thereto;
- (c) the steps taken/being taken by the Government to remedy this situation; and
- (d) the details of the competitive approach adopted by these TSPs in relation to their private counterparts who have been reducing their tariff rates continuously?

ANSWER

## MINISTER OF STATE FOR COMMUNICATIONS, HUMAN RESOURCE DEVELOPMENT AND ELECTRONICS & INFORMATION TECHNOLOGY (SHRI SANJAY DHOTRE)

- (a) & (b) As informed by BSNL and MTNL, the market share of BSNL has increased and market share of MTNL has decreased during the last three years as given below:

| Market Share (in %age)   | Market Share (in %age)   | Market Share (in %age)   | Market Share (in %age)   |
|--------------------------|--------------------------|--------------------------|--------------------------|
| PSU                      | As on 31.03.2017         | As on 31.03.2018         | As on 31.03.2019         |
| BSNL                     | 9.63                     | 10.26                    | 10.72                    |
| MTNL*                    | 7.37                     | 7.16                     | 6.95                     |

The Telecom sector is facing financial stress due to stiff competition and reduction in tariffs. The Gross Revenue of two private operators i.e. Airtel and Vodafone/Idea has also reduced in FY 2017-18 and FY 2018-19. For BSNL and MTNL, stiff competition in mobile segment, high employee cost and absence of 4G services (except in few places for BSNL) in the data-centric telecom market is eroding their competitive strength.

(c) The Government has approved the revival plan for BSNL and MTNL on 23.10.2019. The revival  plan  inter-alia,  includes  the  measures  to  reduce  the  Staff  cost  through  a  Voluntary Retirement  Scheme  (VRS)  for  the  employees  of  age  50  years  and  above,  administrative allotment  of  spectrum  to  BSNL/MTNL  for  providing  4G  services,  monetisation  of  assets  of BSNL/MTNL  for  repayment  of  debt  and  generating  resources  for  CAPEX/OPEX,  debt restructuring  by  raising  of  sovereign  guarantee  bonds  and  in-principle  approval  for  merger  of BSNL  and  MTNL.  With  the  implementation  of  the  revival  plan,  BSNL/MTNL  will  offer improved and competitive services to their subscribers and turn profitable soon.

(d) To compete with the policy of reducing tariff by their private counterparts, BSNL and MTNL are offering most competitive and affordable tariff in mobile services.  However, tariff rationalization is a dynamic and continuous process determined by market dynamics, regulatory guidelines etc.

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