Cabinet approves hiving off BSNL mobile towers into separate firm

Cabinet approves hiving off BSNL mobile towers into separate firm”

Tenancy ratio is derived by dividing the number of base stations or antenna installed at mobile towers with the total number of towers. There are around 4.42 lakh mobile towers in the country out of which more than 66 thousand are of BSNL.

The Union cabinet on Tuesday cleared a plan for loss-making state-run telco Bharat Sanchar Nigam Ltd to raise revenue by hiving off its 66,000 towers into a wholly-owned subsidiary over two years.

At a press briefing, telecom minister Manoj Sinha said the decision does not involve any move to privatise the towers.

Another official said the Telecom Commission in its last week's meeting chose to award a ₹3,100-crore contract to Bharti Airtel for connecting 4,500 villages in the North East, so why was some go-ahead given to BSNL projects in the same region. Private telecom service operators have been doing this through separate tower companies.

According to government sources, numerous projects were discussed during the Telecom Commission meet recently, but not given much attention was paid to BSNL projects.

The mobile tower industry has emerged as an independent business to harness the potential for sharing of infrastructure.

"We have a tenancy ratio of 1.14% while the others have 1.9%". " the time we execute this (tower business hive off), we will reach to where other service providers are", he said. This (separate company) will lead to increase in our tenancy ratio as well.

Mr Sinha said that Cabinet Committee on Economic Affairs has also approved the 161 kilometer long Barabanki-Akbarpur doubling project at a completion cost of over 1,310c crore rupees. "More than 1,600 BSNL employees are expected to go on deputation for this", Sinha said.

A tower infrastructure company essentially owns the passive infrastructure asset and leases it to telecom service providers enabling them to minimize duplication of investments and economize on costs of Operation and Maintenance (O&M), thereby improving profitability. "This work will be completed in two years", he said.

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