The Department of Telecommunications under the Ministry of Communications is responsible for promotion and regulation of the telecommunications (telecom) sector.  The Department also administers several public sector undertakings involved in providing telecommunication services, consultancy, training and equipment manufacturing.[i]  This note examines the allocation to the Department in 2024-25, trends in expenditure over the last few years, and discusses certain key issues in the sector.

Overview of Finances

Expenditure[ii]

In 2024-25, the Department has been allocated Rs 1,11,915 crore, an increase of 14% over the revised estimates of 2023-24 (Table 1).  In 2024-25, 79% of the Department’s budget is towards support to BSNL and MTNL.  The allocation to the Department in 2024-25 is 2.3% of the total budget of the central government. 

 Table 1: Allocation for 2024-25 (Rs crore) 

	2022-23	2023-24 BE	2023-24 RE	2024-25 BE	% change from 2023-24 RE to 2024-25 BE
Revenue	64,232	35,887	28,260	27,419	-3%
Capital	54,729	61,692	70,099	84,496	21%
Total	1,18,961	97,579	98,359	1,11,915	14%

Note: RE: Revised Estimates; BE: Budget Estimates.
Sources: Expenditure Budget, Union Budget 2024-25; PRS.

Between 2020-21 and 2023-24, roughly half (47%) of the budget of the Department has been spent on BSNL and MTNL.  Support to BSNL has been announced in three tranches (Table 2).[iii]^,[iv],[v]  The budgetary trend shows that while funds were provided for the voluntary retirement scheme,  no capital infusion took place in either 2020-21 or 2021-22.

Capital infusion of Rs 82,916 crore is estimated for BSNL in 2024-25.  This is 28% higher than the revised estimates for 2023-24 (Rs 64,787 crore).  In 2022-23, actual capital infusion (Rs 26,386 crore) was 41% lower than the budget estimates (Rs 44,720 crore).  However, viability gap funding of Rs 16,189 crore was spent.  Viability gap funding for 2023-24 (revised estimates) and 2024-25 is estimated to be Rs 1,200 crore each year. 

Table 2: Major components of revival plans as sanctioned by Cabinet (Rs crore)

Component	Amount
2019 Revival Package
Purchase of Spectrum	20,140
Voluntary Retirement Scheme	17,169
Sovereign Guarantee for Bonds	15,000
Support for Payment of GST for Spectrum	3,674
2022 Revival Package
Purchase of Spectrum	44,993
Sovereign Guarantee for Bonds	40,399
Support for Payment of AGR Dues	33,404
Support for Capital Expenditure	22,471
2023 Revival Package
Purchase of Spectrum	88,516
Miscellaneous	532

Sources: PIB Press Releases; PRS.

Since 2021-22, no capital infusion has been budgeted or spent in MTNL (Figure 1).  In 2023-24, at the revised estimates stage, Rs 865 crore was added as payments towards MTNL bonds.  For 2024-25, this amount has increased by 324% to Rs 3,669 crore.  See Table 9 in the annexure for complete details.