NEW DELHI: Indian telecom firms particularly suppliers of state-run telcos– Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) are set to reduce workforce by half, on the back of non-payment of outstanding worth Rs 20,000 crore.
“One lakh employees of domestic telecom industry are expected to lose their employment since the financially unstable companies are no longer to sustain with government failing to address their grievance to clear outstanding dues worth Rs 20,000 crore,” Sandeep Aggarwal, chairman— Telecom Committee at the PHD Chamber of Commerce and co-chairman of the Telecom Exports Promotion Council (Tepc) told the PageOne.
The industry employs a total of 200,000 personnel including the indirect workforce.
Companies that are currently impacted and resorting to a series of cost-cutting measures include – Sterlite Technologies Limited (STL), Paramount Wires & Cables Limited (PWCL), Vihaan Networks Limited (VNL), Transline Technologies, Aksh OptiFibre, and Clixxo Broadband.
Meanwhile, telecom secretary Anshu Prakash Monday assured the industry bodies and representatives of companies and said that suitable action would be taken within the next 10 days to address the issues faced by homegrown firms including non-payment from two state-run telecom service providers.
The industry groups, according to Aggarwal, have already sought intervention from the highest levels in the government but no action has been taken so far, forcing local companies with no other option than to cut staff.
The beleaguered companies are also facing stiff pressure from creditors with few of them are even considering liquidity.
Some companies are also expected to move insolvency pleas against the government-owned telecom carriers for non-payment of dues.
Last month, the Narendra Modi-headed Cabinet approved a Rs 70,000-crore worth of relief package for BSNL and MTNL including Voluntary Retirement Scheme (VRS), assets monetisation and allocation of next generation of airwaves.
But the local firms argue that the Centre’s scheme might bring two telcos back to health, it squarely failed to address the issues faced by them including clearance of their outstanding amount.
Multinationals such as Nokia, ZTE and UTStarcom too have combined dues of more than Rs 1500 crore stuck with India’s state-driven service providers.