BSNL, MTNL Prioritize Govt Sales in Rs 1 Lakh Crore Land Asset Monetization
ECONOMY & POLICY

BSNL, MTNL Prioritize Govt Sales in Rs 1 Lakh Crore Land Asset Monetization

State-run telecommunications giants Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) have decided to prioritize government organizations, both at the state and central levels, in the sale of their extensive land assets, valued at over Rs 1 lakh crore. This strategic move aims to streamline the transaction process and avoid litigation, according to an official familiar with the matter.

Only if government entities do not require the properties will these assets be offered to private enterprises through auctions. The sale to government organizations is clean and smooth and does not have unnecessary litigation,? the official stated.

An example of this initiative is BSNL?s recent sale of a property in Lucknow to the Income Tax department for approximately Rs 2.29 billion, matching the market value. Despite the direct sales approach, properties are not sold at subsidized rates but at their market value, ensuring fair pricing without the need for auctions.

To date, BSNL has raised Rs 16 billion through sales to both government and private sectors and plans to generate Rs 200 billion over the next 4-5 years through land monetization. Property consultants and realty experts view the monetization of BSNL and MTNL assets as a significant opportunity, particularly in key cities experiencing a post-pandemic real estate boom, such as Mumbai, Bengaluru, Delhi, and Hyderabad.

Neeraj Mittal, the telecom secretary, recently communicated with secretaries of various central ministries and state chief secretaries, emphasizing the availability of BSNL and MTNL properties for direct sale. BSNL has launched a dedicated website listing properties available for purchase by government entities, aiming to facilitate smoother transactions.

Despite these efforts, the process of land asset sales has been slow. The government has urged both BSNL and MTNL to expedite the monetization by creating detailed, valuation-based lists of their land parcels.

Land monetization is a critical component of the revival strategy for these ailing telecom firms. In 2019, a substantial revival package of Rs 690.21 billion helped reduce operating costs, and a subsequent package of Rs 1.64 lakh crore in 2022 provided fresh capital and restructured debt. These measures have led to operational profits since 2020-21.

Moreover, the union cabinet approved a significant allocation of 4G/5G spectrum to BSNL in June 2023, amounting to Rs 890.47 billion through equity infusion, further bolstering the company?s capabilities and market competitiveness.

State-run telecommunications giants Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) have decided to prioritize government organizations, both at the state and central levels, in the sale of their extensive land assets, valued at over Rs 1 lakh crore. This strategic move aims to streamline the transaction process and avoid litigation, according to an official familiar with the matter. Only if government entities do not require the properties will these assets be offered to private enterprises through auctions. The sale to government organizations is clean and smooth and does not have unnecessary litigation,? the official stated. An example of this initiative is BSNL?s recent sale of a property in Lucknow to the Income Tax department for approximately Rs 2.29 billion, matching the market value. Despite the direct sales approach, properties are not sold at subsidized rates but at their market value, ensuring fair pricing without the need for auctions. To date, BSNL has raised Rs 16 billion through sales to both government and private sectors and plans to generate Rs 200 billion over the next 4-5 years through land monetization. Property consultants and realty experts view the monetization of BSNL and MTNL assets as a significant opportunity, particularly in key cities experiencing a post-pandemic real estate boom, such as Mumbai, Bengaluru, Delhi, and Hyderabad. Neeraj Mittal, the telecom secretary, recently communicated with secretaries of various central ministries and state chief secretaries, emphasizing the availability of BSNL and MTNL properties for direct sale. BSNL has launched a dedicated website listing properties available for purchase by government entities, aiming to facilitate smoother transactions. Despite these efforts, the process of land asset sales has been slow. The government has urged both BSNL and MTNL to expedite the monetization by creating detailed, valuation-based lists of their land parcels. Land monetization is a critical component of the revival strategy for these ailing telecom firms. In 2019, a substantial revival package of Rs 690.21 billion helped reduce operating costs, and a subsequent package of Rs 1.64 lakh crore in 2022 provided fresh capital and restructured debt. These measures have led to operational profits since 2020-21. Moreover, the union cabinet approved a significant allocation of 4G/5G spectrum to BSNL in June 2023, amounting to Rs 890.47 billion through equity infusion, further bolstering the company?s capabilities and market competitiveness.

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