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“They want to let BSNL die”: The rot inside India’s government-owned telecom firms

REUTERS/Rupak De Chowdhuri
No network zone.
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Almost a year ago, the landline phone that Amish Gupta (name changed) had installed at home in 2005 stopped working. It was a recurring problem, and Gupta chose to ignore it—he used his cell phone to make calls anyway.

In May, however, when the broadband internet-connected to his landline began fluctuating, Gupta decided to complain to his telecom service provider, Mahanagar Telephone Nigam or MTNL. A subsidiary of the central government-owned Bharat Sanchar Nigam (BSNL), MTNL provides telecom services in Mumbai and Delhi.

“I called to register my complaint at least 10 or 15 times, but no one came to service my connection,” said Gupta, a 64-year-old travel consultant from central Mumbai. He then went to the local MTNL office in Wadala, only to find most of it empty. “They don’t have the staff to do the work, and I just got pushed around from one desk to another.”

Working from home in the middle of a pandemic was not possible without a stable internet connection, and in July, a frustrated Gupta finally decided to surrender his MTNL connection altogether.

“The surrender process itself has been going on for more than two months,” he said. “I usually like to favour public companies like MTNL and I am not an Ambani fan, but I was forced to get a Jio landline and broadband.”

Reliance Jio Infocomm, owned by Asia’s richest person Mukesh Ambani, has been controversial for disrupting the telecom market in 2016 by launching extremely low-cost 4G services.

At an MTNL workers’ union office in Dadar, Mumbai, the mere mention of Jio is enough to make union members scoff. “This is exactly why the government is letting MTNL and BSNL die—they want to favour private companies,” said 58-year-old Suryakant Mudras, a former deputy manager at MTNL.

Involuntary retirement for BSNL staff

The number of landline phone connections in India have been falling ever since mobile phones grew more ubiquitous. MTNL, for instance, had 6 million landline customers in Delhi and Mumbai in 2010, but now has just 2.7 million. Across India, the number of landline users has dropped from 24 million in 2016 to 19 million in July 2020.

But the advent of cell phones has not been the only factor driving users away from BSNL and MTNL landlines. Many customers have been complaining about poor services for well over a decade.

Manjula Goswami, a teacher from Faridabad, Haryana, surrendered her BSNL landline in 2009. “When we complained about our instrument not working, the response from BSNL was never prompt, and they did not have enough staff, so we finally got frustrated and gave up,” said Goswami.

BSNL and MTNL workers acknowledge such problems and attribute them partly to a general shrinking in staff strength since the early 2000s.

“Employees have retired but MTNL has not hired new staff at the same rate for years,” said Sandesh Shirke, a section supervisor at MTNL Mumbai and a member of the MTNL Kamgar Sangh union.

Maintenance of landline phones typically requires one technician for every 500 phones. “Now we barely have one technician for every 2,000 landline phones,” said Thomas John, president of the Federation of National Telecom Operators union.

The staff numbers sharply declined in the past year after the union Department of Telecommunications announced a new voluntary retirement scheme (VRS). It was part of a Rs70,000 crore ($9.4 billion) revival package for BSNL and MTNL, of which nearly Rs30,000 crore was set aside for the VRS plan.

A total of 92,300 workers between 50 and 60 years of age retired from service on the same day, cutting down BSNL-MTNL’s national staff strength by almost half. The aim of the VRS plan was to significantly reduce wage costs for the two public sector companies, which have been loss-making for nearly a decade. BSNL, for instance, registered a loss of Rs13,804 crore in 2019, while MTNL reported a loss of Rs3,693 crore that year.

For workers and unions, however, VRS has become a controversial bone of contention with the BSNL and MTNL management, triggering dozens of staff protests and hunger strikes against it across the country.

Workers allege that employees were indirectly pressurised into opting for voluntary retirement.

“I opted for the VRS scheme, but there was nothing voluntary about it for many of us,” said Mudras, who had clocked 30 years of service and put in his papers on Jan. 31, just two years before his official retirement age. A member of the MTNL Kamgar Sangh, a union run by the Shiv Sena party in Mumbai, he said: “The company had created an atmosphere that forced us to take this step.”

For one, he alleged he did not receive his salary on time for the last three years of his job. When the VRS plan was announced, he was told that MTNL Mumbai had a target of retiring 850 employees under the scheme by Jan. 31. “They said that if this target was not met, they would lower the official retirement age from 60 to 58 so that more people would be eligible,” said Mudras, the sole breadwinner of his family. “This scared me.”

The impact of Covid-19 lockdown

In the months since the VRS plan was implemented and the Covid-19 lockdown came into force, Shirke, the section supervisor, claims there has been a surge in the number of applications from customers seeking to surrender their landlines.

Mudras also claim to have observed a rise in customer complaints in the past nine months. Since he was responsible for addressing complaints by customers like Gupta, many old customers in central Mumbai had grown friendly with him and called him directly on his cell number when they had a complaint. They continued to call even after he retired, he said.

According to workers’ unions, the downsizing made it nearly impossible for MTNL and BSNL to provide satisfactory services to consumers during the lockdown period when most people were working from home.

Scroll.in sent questions to PK Purwar, the chief managing director of BSNL and MTNL, about the implementation of the VRS plan and the allegations by union leaders, but did not receive a response.

Challenges before BSNL, MTNL

But staff shortage is not the only reason why the government telecom companies are floundering, say current and former employees.

“We have also known for a long time that our old landline copper cables need to be upgraded to fibre cables, but we have not been given the budgets,” said Shirke, the section supervisor.

But the most glaring disadvantage for BSNL and MTNL is the fact that they are still stuck with 3G technology, while a large number of consumers have rapidly moved on to 4G since 2016.

“The government has not allowed us to get a 4G license even though all our private sector competitors provide 4G,” said John. “So naturally we are losing customers we cannot blame them for choosing better and faster services.”

In the Rs70,000 crore revival package approved for the companies last year, nearly Rs 24,000 crore was meant to be for allocating 4G spectrum to BSNL and MTNL. A tender for buying 4G equipment from Chinese companies Huawei and ZTE was finalised, but in July, BSNL was forced to cancel the tender. After 20 Indian soldiers were killed during a stand-off with the Chinese army in June, the central government barred public sector companies from striking any deals with Chinese companies.

“But private companies were not stopped from such deals. How is this fair?” said Shirke.

By the time a fresh tender for 4G is finalised, unions are afraid private companies will have moved on to 5G technology.

The combined impact of outdated services and lower staff will inevitably mean a drop in customer base and even bigger financial losses, say unions. “The government is giving encouragement to private players in the industry, but letting its own organisation stagnate,” said Dinesh Mistry, the assistant general secretary of the National Union of BSNL Workers.

Scroll.in sent email queries to senior officials in the Department of Telecommunications about the allegations by union leaders but has not received a response so far.

“Every decision that the government has taken has been against the interests of MTNL-BSNL,” said Arvind Sawant, the head of the MTNL Kamgar Sangh and also a member of Parliament from the Shiv Sena. “They want to let BSNL die.”

This piece was originally published on Scroll.in. We welcome your comments at ideas.india@qz.com.

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