Budget 2024: BSNL gets lion's share of ₹1.28 lakh crore for telecom sector

The state-owned entity gets ₹82,916 crore for capital infusion and restructuring-related expenses. Funds are also to be used for technology upgradation.

Government-owned Bharat Sanchar Nigam Limited (BSNL) has been allocated a lion's share of ₹82,916 crore out of the total ₹1.28 lakh crore earmarked for the telecom sector.

As per data from telecom regulator TRAI, BSNL lost nearly 2.3 million subscribers, limiting its user base to just 88.06 million in March 2024. And deployment work for the 4G network has been ongoing at a much lesser pace than expected. ((REUTERS))

Finance minister Nirmala Sitharaman in her budget speech proposed to allocate over ₹1 lakh crore together for both BSNL and MTNL, another state-owned entity. A majority of the funds for BSNL are set to be used for technology upgradation and restructuring of the organisation.

"The total net allocation for this demand in BE (Budget Estimate) 2024-25 is ₹1,28,915.43 crore ( ₹1,11,915.43 crore plus ₹17,000 crore). The additional provision of ₹17,000 crore is met from the balances available under Universal Service Obligation Fund and will be utilised for schemes viz., Compensation to Telecom Service Providers, Bharatnet and Research and Development," the budget document said.

For pension-related expenses of the Department of Telecommunications (DoT) employees, including BSNL and MTNL, the budget has made a provision to allocate ₹17,510 crore with effect from April 1, 2014. To pay the principal amount of MTNL-related bonds, the government has proposed to allocate ₹3,668.97 crore.

To boost domestic manufacturing of telecom-related equipment and discourage imports, Sitharaman has proposed to increase the import duty on motherboards, also known as called Printed Circuit Boards (PCB)'s, by 5 per cent. “To incentivise domestic manufacturing, I propose to increase the BCD (Basic Customs Duty) from 10 per cent to 15 per cent on PCBA (printed circuit board assembly) of specified telecom equipment,” she added.

The import duty hike exempts PCB's that are made of critical and strategic minerals used in the manufacturing of communication equipment.

25 minerals, such as lithium, copper, cobalt, and rare earth elements, which are critical for sectors like nuclear energy, renewable energy, space, defense, telecommunications, and high-tech electronics are fully exempt from customs duties and basic custom duties (BCD) on two of them has been reduced. "This will provide a major fillip to the processing and refining of such minerals and help secure their availability for these strategic and important sectors," Sitharaman said.

(With PTI inputs)