Aiming to optimise resources and give customers a nationwide footprint, the Union government is considering the merger of state-run telecom public sector undertakings, Bharat Sanchar Nigam Limited and Mahanagar Telephone Nigam Limited.
"The merger of BSNL and MTNL makes sense. Today, telecom operators need to be present across India for better coverage and services.
"At this stage, we have not taken any decision but there are valid arguments in the favour of merger and we are considering it," said Telecom Secretary R Chandrasekhar.
It doesn't make sense for an operator to confine only to one part of the country or city, he said, adding currently MTNL cannot operate outside metros and BSNL cannot operate in metros.
"We have received the report and we will take some time to consider that," he said.
A decision on the merger will take some time as there are procedural problems with MTNL being a listed entity and BSNL non-listed.
The Board for Reconstruction of Public Sector Enterprises
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had recently recommended that MTNL and telecom equipment manufacturer ITI should be merged with BSNL.