Govt may divest 5% in BSNL

kolkata: it may be a while before fantasy turns to reality. indications are that the government may just about consider divesting a tiny 5 per cent stake in bharat sanchar nigam in the days to come. right now, 100 per cent of bsnl ownership rests with the government. department of telecommunications secretary shyamal ghosh is unwilling to be drawn into specifics, but says nevertheless, "no timelines have been fixed yet, although we are watching the markets closely." be that as it may, even a tiny divestment in the state-owned telecom colossus is expected to rake in mega bucks into the government coffers. consider the facts -— bsnl''s national subscriber base is in the excess of 30 million and it operates the world''s eighth-largest telecom network. bsnl''s valuation is at a dizzy $7 billion (rs 35,000 crore) while net worth is a monumental $12.6-billion (rs 63,000 crore), thanks to its mammoth reserves. though the government rules out any divestment beyond 5 per cent, if at all, the industry largely believes that any divestment short of 10 per cent will not attract too much attention. the industry wonders whether the divestment could also be in the overseas markets. significantly, the dot secretary has categorically ruled out privatisation of bsnl, which was corporatised in october 2000. "disinvestment need not lead to privatisation...the issue that needs to be debated is whether the existence of state-owned utilities like bsnl or mtnl have triggered competition and actually driven down telecom tariffs,"he said. nonetheless, information available suggests that privatisation of mtnl is about to pick up steam. much will hinge on the absorption of some 5,000 group a & b staffers at mtnl who are on deemed deputation from the dot. significantly, the dot has fixed february 28, 2002, as the cut-off date, whence these employees will need to exercise their option of whether or not to return to dot. accordingly, an indicative mtnl divestment timeline may be frozen only after february 28 referendum. indications are that the mtnl divestment may be the mirror image of the recent vsnl disinvestment.