Govt favours BSNL - MTNL merger

NEW DELHI: The government has favoured the merger of Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) by early 2006-2007 fiscal year.

The suggestions submitted by the expert committee on the merger of the two PSUs are being worked upon. While the Government is in favour of the merger, the exact modalities to come in to effect would take some time because of the complexities involved in it.

Officials from the Ministry of Communications said that the union bodies of both the telecom companies are not opposed to the move by the government. The officials confirmed that the government would announce the merge within the financial year 2006-2007.

Since MTNL was a listed entity and BSNL wholly owned by the Government, there were lots of issues required to be addressed before taking a call on the merger process. The Government would do what would be beneficial for both the companies in the telecom sector.

The Government had first hinted at a possible merger between BSNL and MTNL in September 2004. The proposed move gathered momentum since Dayanidhi Maran took over the Ministry of Information Technology and Communications in May 2005.