Plans VRS to reduce 50% headcount
Hyderabad: Cash crunch has been taking a toll on the telecom major BSNL. This situation is forcing it to cut down its headcount by half. As a result, over 80,000 employees may be shown door very soon. BSNL has already taken up an exercise of monetising land assets to ease out cash flow crunch. Further, the BSNL is also adopting cuts in operational costs.
Bharat Sanchar Nigam Ltd (BSNL) is awaiting the approval from the Centre for its jobs cut. The telecom major has prepared a voluntary retirement scheme (VRS) to half its workforce. The total headcount at BSNL is 1.65 lakh. The wage cost accounts for 75 per cent of the total revenues of BSNL. After implementing the VRS, we may outsource some work and appoint people on contract basis as per the future requirement.
The accumulated losses of BSNL rose to Rs90,000 crore till date. BSNL made profit for the last time was in the 2008-09 financial year. BSNL’s profit in FY09 was Rs575crore.
BSNL is also planning to offer Bonds to finance the proposed VRS. BSNL has no option but to mortgage its assets for backing Bonds.
BSNL is also making other income by way of leasing and renting. The other income was Rs200crore in the last fiscal and is expected to reach Rs1,000 crore in next year. Out of 68,000 towers, BSNL leased out 14,000 towers to other telecom companies. This situation is how we're generating additional revenues, said a senior official.
BSNL is eagerly looking to a possible bailout package from the Centre. Union Telecom Minister Ravishankar Prasad hinted such support to the telecom sector.