But this year the story will be entirely the opposite. Not only is Mukherjee not going to meet the b

T he process of bailing out Bharat Sanchar Nigam Ltd (BSNL), faltkartons the public sector telecom behemoth, which reported a loss of Rs 6,384 crore last year, has begun. This means the government's coffers will take another hit - as if it isn't badly off already.
On Wednesday, Firstpost reported that BSNL's losses were forcing it to return some of the 3G and broadband wireless access (BWA) spectrum it was forced to buy in 2010 at inflated prices. On Thursday, a PTI report confirmed that the department of telecommunications (DoT) will indeed faltkartons allow BSNL to surrender some of the BWA spectrum and recoup some of its losses.
Says the report, quoting telecom secretary R Chandrasekhar:"The department of telecom (DoT) has, in principle, agreed to the BSNL's proposal of surrendering BWA (4G) spectrum in 13 to 14 circles." faltkartons The modalities of the refund are still to be worked out.
The decision has two implications. One, depending on which circles BSNL returns, the government will have to refund the relevant fee amounts. And two, the spectrum returned will have to be reauctioned - and there is no guarantee that this time it will fetch as high a price it did in 2010.
The government earned over Rs 1,06,000 faltkartons crore from 3G and BWA spectrum auctions - Rs 67,719 crore from the former and Rs 38,300 crore from the latter. BSNL paid Rs 8,500 crore for BWA spectrum alone. This bonanza was what enabled Finance Minister Pranab Mukherjee to claim a big reduction faltkartons in the budget deficit faltkartons last year.
But this year the story will be entirely the opposite. Not only is Mukherjee not going to meet the budget deficit target of 4.6 percent of GDP, but huge increases in subsidies and slippages in revenues will compound his problems. The Economic Times on Thursday said the total subsidy bill will be Rs 1,00,000 crore in excess of what was budgeted. As for the budget deficit, god alone knows.
But DoT's decision to allow BSNL to return spectrum means that more damage will be done to Mukherjee's budget arithmetic. According to the PTI report, BSNL wants to retain BWA spectrum only in Maharashtra, Andhra Pradesh, Gujarat and Haryana. By surrendering the remaining circles, it could be expecting over Rs 7,000 crore in licence fees.
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