The Comptroller and Auditor General (CAG) of India has said that two PSUs — Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) — have lost to the tune of Rs 1,800 crore due to idle investments and non-recovery of payments from private parties for using its infrastructure. In a report tabled in Parliament today, the CAG has noted that the total loss due to non-utilisation of equipment and related infrastructure procured for fixed lines of BSNL was about Rs 795 crore.

“The subscriber base of landline telephone service of BSNL has declined from 3.54 crore in March 2003 to 3.35 crore in January, 207 whereas net switching capacity (NSC) has increased from 4.50 crore to 4.73 crore during the same period,” the CAG has pointed out.

In a test check pertaining to 63 telephone exchanges in Gujarat, Kerala, UP (East), and Chennai, the CAG found that “though the total equipped capacity was expanded from 2.05 lakh lines to 2.59 lakh lines, the total number of subscribers decreased from 1.62 lakh to 1.54 lakh.”

“In all these exchanges, the working telephone connections as of December 2006 were such that the same could have been accommodated from their pre-expansion capacities.” BSNL officials have opposed the CAG report, saying that the company is facing tough competition from private players.

“It is a unique PSU in the service sector in the sense that it has to compete with five private sector players in a circle. This number is about to increase. Therefore, we have to be prepared with excess capacity.” He also pointed out that the problem that BSNL is facing is shortage of capacity for mobile telephone lines. Therefore, BSNL’s private competitors have overtaken it in mobile telephony.

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