BSNL in a bind as govt plans to shut funds tap

Govt unlikely to reimburse licence fee from current fiscal.

In a blow to its capital expenditure (capex) plans, Bharat Sanchar Nigam Ltd (BSNL) is unlikely to receive its annual reimbursement of licence fee from this financial year.

The company had sought a refund of Rs 2,300 crore from the Rs 3,100 crore it paid as licence fee for 2003-04.

In addition, BSNL's claims that it be given a compensation of around Rs 3,500 crore it paid as pension benefits for three years are also likely to be ignored by the government.

Senior BSNL executives said the "non-recovery of dues" would affect BSNL's capex plan of Rs 11,000 crore for the current financial year.

Of the planned capex, Rs 10,000 crore was to be generated through internal accruals and refunds from the government, and Rs 1,000 crore was to be funded through borrowings.

At the time of corporatisation of the departments of telecom services and telecom operations for the setting up of BSNL in 2000, the government had agreed to take over the pension liability for employees who opted to join the new entity, the executives said.

They said the government had in the past agreed to refund its licence fees. Senior government officials, however, said the government had agreed to refund the licence fees for three years. Thus, there was no liability from this year.

On its part, BSNL said the government had agreed to refund the licence fee for three years and would take a decision annually during the remaining part of the Tenth Plan.

On the issue of pension liability, a DoT official said the government would discuss the modalities at a later date. BSNL has taken up the matter with the finance ministry.