₹1,757.76-crore loss to Centre due to Reliance Jio erroneously overestimated: BSNL

State-run telecom service provider Bharat Sanchar Nigam Limited (BSNL) is preparing a response to the Department of Expenditure (DoE) saying that there was no loss of ₹1,757.76-crore to the Centre following not billing to Reliance Jio Infocomm Limited (RJIL), and it had been inaccurately blown out of proportion.

“There is no revenue loss to BSNL as previous demand and therefore loss (of ₹1,757.76-crore) had been erroneously overestimated due to misrepresentation and application of the clause for add-on components,” said the state-run telco in its response.

Further, the telco, in its rejoinder, is likely to submit that the circles had already raised invoices to Reliance Jio for ₹108-crore, and is pursuing with Jio to collect the additional amount over and above the regular base rental being paid by the private sector telco.

India’s Comptroller and Auditor General (CAG), in a finding, said that BSNL’s inability to bill Reliance Jio for shared telecom infrastructure between 2016 and 2020 resulted in a loss of ₹1,757-crore to the government exchequer.

“BSNL failed to enforce the Master Service Agreement (MSA) with M/s. Reliance Jio Infocomm (RJIL) and did not bill it for the additional technology used on BSNL’s shared passive infrastructure, resulting in loss of ₹1,757.76-crore and penal interest thereon, between May 2014 to March 2024 to the government exchequer,” CAG in its report said.

Non-adherence to the terms and conditions laid down in the MSA with Reliance Jio Infocomm Limited by BSNL and non-application of the escalation clause resulted in a revenue loss of ₹29-crore (including GST) towards infrastructure sharing charges, it added.

Sources say that the country’s auditor apparently overlooked the fact that the agreement with Jio for infrastructure sharing was reciprocal in nature.

The state-controlled telco, in its yet-to-be-made submission, also said that the itemised rates already agreed upon by Jio in April 2018 were offered for additional hardware and power for using both TDD and FDD technology beyond the standard configuration.

Following consent from Jio, BSNL added that an addendum to the MSA was signed with Jio on January 31, 2025, for applicable charges for using 4G TDD and FDD.

In conformity with the Centre’s policy allowing sharing of infrastructure by telecom carriers, BSNL and Mahanagar Telephone Nigam Limited (MTNL) also started monetisation of their towers by sharing them with private sector players.

In a bid to reduce capital expenditure (capex) and operational costs (opex), BSNL, in 2014, entered into a telecom infrastructure sharing arrangement with Reliance Jio, Bharti Airtel, and erstwhile Vodafone India and Idea Cellular.

However, in February 2020, the then Minister of Communications Ravi Shankar Prasad, responding to a question in Rajya Sabha said, “out of 13146 mobile towers shared by BSNL, 8363, 2779 and 1782 mobile towers have been shared with Reliance Jio, Bharti Airtel and Vodafone Idea respectively.”

No fixed income was transferred from BSNL to Jio, he added.

Billionaire Mukesh Ambani-owned Jio made payments of ₹171.81-crore (2016-17), ₹472.80-crore (2017-18) and ₹678.38 (2018-19), and ₹402.28-crore (3 quarters of 2019-20), according to statistics available.

BSNL is likely to submit its response to the Centre following the necessary approvals this month.