Will BSNL and MTNL recover Rs 4,399 crore?

The total outstanding dues for telecom PSUs, BSNL and MTNL as of 2013 is Rs 4,399 crore of which BSNL has an outstanding due of Rs 3,212 crore whereas MTNL has an outstanding of Rs 1,187 crore.

For FY 2012-13, the consolidated revenue for BSNL and MTNL is around Rs 29,825 crore whereas its outstanding dues stands at Rs 4,399 crore. The outstanding dues are high as it has got accumulated over the years and there is no provision of write off in telecom PSU.

Both the companies have initiated lot of measures for recovering outstanding dues like: Payment reminders through IVRS/SMS to ensure timely issue of telephone bills and disconnection of telephones for non-payment; Disconnecting phones after six months from the date of disconnection; legal proceedings required for recovery of dues; Graded discount scheme to incentivize defaulting customers; circle-wise and year-wise target for liquidation of outstanding dues; and Circles have also been asked to utilize lok adalats for recovery of outstanding dues.

So, the big question is why BSNL and MTNL is not able to recover their outstanding dues despite all the efforts?

First, both BSNL and MTNL need to revisit their process and fix accountability at all levels be it GM telecom revenue or DGM telecom revenue or up. Focus should be also on timely delivery of bills and increasing counters at corporate offices, neutral locations where people can drop their cheques as per their convenience.

Second, majority of Rs 4,399 crore comes from corporate, government clients and interconnect revenues. BSNL and MTNL should follow the best practices followed by banking sector or private telcos and follow them in letter and spirit to recover outstanding dues from corporate and government clients. There should also be write off provision at the board level so that the amount does not look big to the tune of Rs 4,399 crore.

Third, both BSNL and MTNL should provide only prepaid landline connections everywhere, this will help in reducing dues in future. For implementing prepaid, PSUs need to install intelligent systems which would be fruitful in the long run.

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