In a renewed effort to improve their financial health, state-owned telecom companies Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) plan to monetise land assets worth ₹1,000 crore during FY26. This move is part of a broader revival strategy aimed at reducing debt and boosting liquidity.
However, the timeline may face delays due to procedural hurdles at the state level.
What This Article Covers
- Overview of the land monetisation plan
- BSNL and MTNL’s current financial status
- Execution challenges and bottlenecks
- Alignment with the government’s asset monetisation goals
Key Highlights of the Land Monetisation Plan
- Target Value: ₹1,000 crore
- Execution Timeline: FY26 (by March 2026)
- Mode: Sale or lease of commercially viable land parcels
- Coordinating Department: Department of Public Enterprises (DPE), Ministry of Finance
BSNL has identified two to three prime land parcels for sale or lease. MTNL is also expected to contribute to the total target. These properties are situated in commercially attractive zones and may draw interest from institutional investors. However, challenges like state-level approvals and title verifications could complicate execution.
Financial Overview: BSNL and MTNL
Both BSNL and MTNL continue to grapple with financial distress, primarily due to:
- Declining subscriber bases
- Legacy infrastructure
- Fierce competition from private telecom operators
Debt Status:
- BSNL (as of November 2024): ₹23,297 crore
- MTNL (as of March 31, 2025): ₹33,000 crore in total liabilities
- MTNL Loan Defaults: ₹8,346 crore across seven public sector banks
Despite receiving a revival package in 2019—which included sovereign guarantee bonds and a Voluntary Retirement Scheme (VRS)—the fiscal pressure remains high.
In response to MTNL’s financial distress, Cabinet Secretary T.V. Somanathan recently held a high-level meeting with heads of public sector banks to prevent these loans from turning into Non-Performing Assets (NPAs).
Execution Challenges: Why Monetising Land Isn’t Easy
While the ₹1,000 crore target appears modest relative to the companies’ liabilities, officials caution that achieving it will be complex. Land is a state subject, making the process dependent on state-level cooperation.
Key hurdles include:
- Ownership verification
- Clear and updated land titles
- Multiple layers of approval from state governments
Officials suggest that actual monetisation could extend into FY27, depending on the speed of these clearances.
Government’s Larger Asset Monetisation Push
This move aligns with the Government of India’s broader infrastructure financing agenda through asset monetisation.
- Budget 2025 Target: ₹10 lakh crore worth of asset monetisation between 2025 and 2030
- Previous Target (2021): ₹6 lakh crore up to 2025
- BSNL & MTNL’s Contribution (So Far): ₹12,984 crore via earlier monetisation efforts
Although there have been discussions about potential privatisation, the government has reaffirmed that no such plans are currently under consideration.
Will Monetisation Deliver Relief?
The proposed land monetisation worth ₹1,000 crore represents a crucial step toward reducing the debt burden of BSNL and MTNL. However, the success of the initiative hinges on resolving procedural bottlenecks at the state level.
Timely execution will be critical to converting these dormant assets into financial resources that can stabilize the balance sheets of these public sector undertakings.
