BSNL and MTNL Monetisation: A New Framework to Speed Up the Process

The government is accelerating the assets monetisation process for Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) to raise funds. This initiative focuses on selling underutilized assets such as land parcels and buildings, which have not been yielding returns. The slow pace of this process has prompted the introduction of a new framework aimed at expediting the asset sale. Here’s a closer look at the updated strategy.

Framework for Asset Sale

BSNL and MTNL, both state-run telecom companies, have been directed by the government to sell their assets to generate revenue.

• Unused Assets: The assets to be sold include land and buildings that are not in active use, helping these companies streamline their operations while generating funds.
• Direct Sales for Small Assets: Under the new framework, assets valued at less than Rs 10 crore can be sold directly by BSNL, MTNL, and ITI Limited at market rates without needing external validation.

Valuation Process for Larger Assets

For assets valued at higher amounts, there is a more structured valuation process.

• Assets Above Rs 10 Crore: For assets worth more than Rs 10 crore, the valuation will be conducted by the Central Public Works Department (CPWD), ensuring a fair and transparent assessment.
• Assets Above Rs 100 Crore: For the most valuable assets, exceeding Rs 100 crore, the National Land Monetisation Corporation (NLMC) will handle the valuation process to ensure proper pricing and sale conditions.

Government and Private Sector Participation

To further expedite the process, the government has created an environment where public entities can also participate in the asset purchases.

• Earnest Money Requirement: Entities interested in purchasing the assets will need to deposit 2% earnest money to demonstrate their commitment to the transaction.
• Private Sector Involvement: If government entities are not interested in buying the assets, private companies can step in to purchase them, thus ensuring the assets do not remain idle.

Progress So Far

Since 2019, BSNL and MTNL have made significant progress in monetizing their assets.

• Revenue Generated: Together, BSNL and MTNL have raised Rs 12,984 crore through the sale of assets, which has helped in improving their financial health while cutting down on underperforming or redundant assets.