MTNL short of funds for 3G fee

NEW DELHI, INDIA: The cash reserve with state-run telecom provider Mahanagar Telecom Nigam Limited (MTNL) is short of Rs 1564 crore than the amount it has to pay for 3G spectrum price by this May 31.

“The cash reserve is of Rs 5000 crore and we are making arrangements for the rest of the amount,” said Kuldeep Singh, chairman and managing director, MTNL, while speaking to media on the sideline of a press conference organized to announce the partnership between MTNL and F-Secure - an Internet security solution provider.

MTNL has been asked to pay Rs 6,564 crore as 3G spectrum fee for two metro circles, Delhi and Mumbai, where it operates.

Singh mentioned that the company is arranging money to pay the price of 3G spectrum as asked by the Department of Telecommunications.

“We have not asked for any concessions from DoT and are making arrangements to pay the fees,” said Singh.

3G revenue has not been contributing to the company’s revenue significantly as of now. And the same has been acknowledged by Singh as well.

“As of now the revenue from 3G is not much, but we expect it to grow when affordable devices come to the market. It will bring down the operational cost for us and hence the price of services,” said Singh.

MTNL has been continuously reporting loss in revenue and price of 3G spectrum is going to fall heavily on the company’s revenue further. In the coming days, MTNL will also have to pay the price of BWA spectrum, which is expected to be a few thousands of crore rupees.

Singh did not mention any specific method in which the company is making arrangements for funds. He only touched upon tender for 3G franchisees, to outsource its 3G network in Mumbai and Delhi, which is expected to come in the next month.

“We are working on the process for tenders and we will try to come with it in next month,” said Singh.