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MTNL not to become a pan-India operator
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NEW DELHI: The communications ministry has shelved the proposal to allow state-owned Mahanagar Telephone Nigam (MTNL) to become a pan-India operator. Last year, MTNL, which provides mobile and landline facilities in Delhi and Mumbai, had submitted a proposal to the Department of Telecom (DoT) to expand to other circles in the country to arrest falling profits.

The other state-owned telecom operator, BSNL, offers communication services all over the country except in Mumbai and Delhi where MTNL is the operator. A top MTNL executive said the government’s move will not impact the company. "We no longer want to offer mobile and landline services outside the two metros. Rather, we would go national through other avenues. We are expanding our national long distance operations across the country. National long distance players carry STD traffic and data for telecom companies. We are also building undersea links to West Asia and Singapore (jointly with BSNL)," the executive said. He also said that MTNL was investing in 3G networks and would require additional funds for building undersea links. So, the company has dropped plans to pursue a pan-India footprint.

According to a DoT official, another reason for the ministry turning down MTNL’s proposal was to ensure that the two PSUs (MTNL and BSNL) complement each other than be involved in an all-out war for cellular subscribers. BSNL had demanded that if MTNL were to get a pan-India licence, it in turn should be allowed to offer services in Delhi and Mumbai. In fact, last year BSNL too had submitted applications seeking DoT’s approval to launch services in Delhi and Mumbai, but the government had rejected it.

MTNL offers services in Nepal and Mauritius but it has lost bids for mobile licences in Saudi Arabia, Kenya, Qatar and Sri Lanka amongst others, in the last three years. Last year, the PSU had emerged as the front-runner to acquire Sri Lankan telco Suntel for about $180 million, but it has now put the acquisition plan on the back burner. MTNL executives say that the PSU is unlikely to revive this proposal.

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