The Department of Telecommunications (DoT) has urged state governments to prioritize telecom services from Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL), citing data security concerns and a 2019 Cabinet mandate.
🔴 Key Highlights:
- DoT Secretary Neeraj Mittal sent letters to chief secretaries of all states and Union Territories on April 8, requesting them to utilize BSNL and MTNL for internet, broadband, landline, and leased line services.
- The directive extends a 2019 Cabinet decision, which mandated central government departments to use BSNL and MTNL for telecom services due to data security risks.
- Private telecom operators and ISPs—which control 92% of the sector’s adjusted gross revenue of ₹2.23 lakh crore (April–December 2024)—could face significant revenue losses if states comply.
- Industry executives have raised concerns, calling the move discriminatory, as it could distort competition and impact smaller ISPs with thin profit margins.
- BSNL posted a net profit of ₹262 crore in Q3 FY25, its first since 2007–08, following revival packages worth ₹3.22 lakh crore since 2019.
📢 Industry Reactions:
- The Internet Service Providers Association of India (ISPAI) has criticized the directive, arguing that the government should remain neutral and promote healthy competition.
- DoT defended its stance, stating that BSNL and MTNL have become competitive players and will dedicate a one-stop nodal point for state governments.
⚠️ Strategic Impact:
- The move could reshape India’s telecom landscape, potentially reducing private sector involvement in government contracts.
- State governments may face pressure to comply, affecting long-term telecom infrastructure investments.
👉 What do you think? Should states prioritize BSNL and MTNL for telecom services? Drop your thoughts in the comments!
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