The union government plans to complete the merger of
the public sector telecom companies, MTNL and BSNL,
by mid next year, Dayanidhi Maran, union minister of
communication and information technology, stated in
New Delhi yesterday.
merchant bankers will make presentations to the union
government this month-end and modalities for the merger
will be worked out within the next three or four months,"
Maran told reporters here.
merged, the combined entity will have a turnover of
Rs35,000 crore compared to its largest private sector
rival, Bharti Tele-Ventures, which has a turnover of
Rs5,000 crore. BSNL and MTNL together command over 95
per cent of the market for fixed lines.
denied any plans to sell the government stake in telecom
PSUs. "The common minimum programme is very very
clear. We are not interested in selling profit-making
PSUs. Even loss-making PSUs, will not be sold, we will
try to revive them, instead," he said.
Maran told delegates at the International Conference
on Telecom that the Indian telecom sector would need
estimated additional investments worth roughly Rs160,000
crore to meet the target of 200 million telephones by
expressed concern about Indian companies not paying
attention to indigenous manufacturing of telecom equipment
and R&D, especially as duties on telecom equipment
will be zero from April 2005. "I am concerned that
even as we are planning major investments in this sector,
our own companies are not in a position to take advantage
of such investments and that the benefit will accrue
to other countries," he said.
Ericsson, Alcatel, LG and Samsung have shown interest
in setting up manufacturing bases in India to avail
cheap labour in India. He said that so far the Indian
telecom industry had attracted foreign direct investments
worth only $2.5 billion. The government is
currently working to increase FDI inflow to the sector.
The recent announcement to increase FDI limit from 49
per cent to 74 per cent is a step in that direction,