BSNL Denies Revenue Loss from Infra Sharing Deal with Reliance Jio

Bharat Sanchar Nigam Limited (BSNL) has responded to a recent report by the Comptroller and Auditor General (CAG), clarifying that there was no revenue loss from its passive infrastructure sharing arrangement with Reliance Jio Infocomm, as per Economic Times news report.

BSNL Clarifies Position on CAG’s Revenue Loss Findings

The CAG report had noted that BSNL’s failure to bill Reliance Jio for additional usage on shared passive infrastructure resulted in a loss of ₹1,757.8 crore between May 2014 and March 2024. However, BSNL stated in an email to The Economic Times that the “previous demand and therefore loss (of ₹1,757.8 crore) had been erroneously overestimated due to misrepresentation and application of the clause for add-on components.”

BSNL said it had raised invoices worth ₹108 crore at the telecom circle level for add-on components, in addition to the base rental payments already made by Reliance Jio. The telco is currently working to collect the invoiced amount, as per the news report.

BSNL Prepares Detailed Response to DoE

In response to the Department of Expenditure (DoE), BSNL is preparing a detailed explanation and is expected to submit it after internal approvals. The response is intended to clarify that the revenue assumptions were based on misinterpretation of agreement clauses, and that billing was carried out as per standard terms.

The CAG report had pointed to BSNL’s non-enforcement of its Master Service Agreement with Reliance Jio, citing the absence of billing for the additional technologies used. According to the auditor, this led to potential financial implications, including a possible penal interest to the exchequer.

BSNL maintains that the contractual terms were applied as intended and there is no financial loss as suggested.

Conclusion

BSNL’s clarification comes amid concerns raised by the CAG regarding the revenue implications of its infrastructure-sharing agreement with Reliance Jio. Its upcoming response to the Department of Expenditure is expected to provide further clarification on the matter. As developments unfold, stakeholders will be watching for any updates from the government or regulatory authorities.

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