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Predatory pricing by Reliance Jio hits BSNL cash flow

Misc News - Published on Thu, 14 Mar 2019

Image Source: wikipedia.org
It is reported that India’s state run telecom company Bharat Sanchar Nigam, for the first time, did not pay salaries to nearly 1.76 lakh employees in February due to financial constraints and that employee union have approached Telecom Minister Manoj Sinha asking him to release funds for employee salaries and to support BSNL financially. In a letter unions in BSNL have said Reliance Jio has left the state-owned company bleeding. The letter said “Predatory pricing by Reliance Jio has left the entire telecom sector stressed. The losses of other companies are much more than that of BSNL. The other operators except BSNL are losing customers in lakhs.”

They said “Power bills, maintenance charges to vendors, wages and rent for vehicles have not been paid on a regular basis for last few months. This has led to a gradual deterioration in BSNL’s services, says the letter. The unions have pointed out that vendors and labourers cannot be expected to stay with the BSNL for long if their dues are not cleared. Other companies on the other hand are managing the situation by infusing huge amounts of funds.”

BSNL has been incurring losses for the past five years. BSNL reported a loss of INR 8,000 crore in FY18, significantly up from a loss of INR 4,786 crore in FY17. Losses in FY19 are expected to rise even further.

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Posted By : TelecomGuru on Thu, 14 Mar 2019
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