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BSNL starts showing improvement after Sibal's tough talk

Within a month of Telecom Ministry reviewing performance of loss-making PSU BSNL, some circles, including Maharashtra and West Bengal, have started showing improvement.

india Updated: Jul 10, 2011 15:56 IST

Within a month of Telecom Ministry reviewing performance of loss-making PSU BSNL, some circles, including Maharashtra and West Bengal, have started showing improvement.

"Out of the 24 circles a few of the circles have already started showing good performance on gross revenue basis between the range of 14 per cent to 18 per cent.

West Bengal is showing a growth of 18 per cent, Maharashtra is giving returns of 15.5 per cent, and Orissa and UP are showing growth of 14 per cent," a senior DoT official said. Earlier Telecom Minister Kapil Sibal had said that the organisation must have targets for circles according to which if the officials don't perform, they will be transferred out while those who meet the targets will be rewarded, like given a posting of their choice. Department of Telecom (DoT) started reviewing performance of all 24 circle heads of the service provider on monthly basis, after a decision to adopt revenue monitoring criteria for reviewing a commercial organisation like BSNL.

BSNL provides telecommunications and related services in 20 of the country's 22 telecom service areas. The PSU, once the country's flagship telecom company and which posted a net profit of over Rs 10,000 crore in 2005-06, reported a net loss of Rs 1,823 crore on revenue of Rs 32,046 crore in 2009-2010.

It is also likely to report losses for the financial year ended March 2011. "Still there are circles, including Uttaranchal, North East, Punjab and Haryana, which are still not performing well and they have to tighten up their belts or else be ready to face the music," the official added.

In terms of mobile subscribers, BSNL has been relegated to the fifth position from the second rank it held just a few years ago since the company has failed to match the competition from private players like Bharti, Vodafone, Idea and Tatas. Earlier, DoT had instructed BSNL directors in all the 22 territorial circles to mop up monthly revenues by 25 per cent, failing which strict action will be taken against them. Under the revenue maximisation strategy, BSNL's circles have been divided into three-revenue wise categories, including those with less than Rs 10 billion revenue, those with Rs 10 billion-Rs 20 billion revenue and circles with revenues in excess of Rs 20 billion.

The company in its projection to Board for Reconstruction of Public Sector Enterprises (BRPSE) had informed that it expects to turn profitable in the fiscal ending March 2013, but projects a net loss for 2010-11 and the ongoing year that began on April 1. It expects a net loss of Rs 2,725 crore on revenue of Rs 31,738 crore in the fiscal year ended March 31, 2011. In 2011-12, the loss is expected to narrow down to Rs 623 crore on revenue target of Rs 36,569 crore.