Centre Considers Just Handing Over MTNL Operations To BSNL, Avoid Merger

Amid mounting financial woes, MTNL this week informed in a statutory filing that it is unable to make interest payment to certain bondholders "due to insufficient funds".

The government is considering the option of handing over operations of Mahanagar Telephone Nigam Ltd (MTNL) to BSNL through an agreement, instead of pursuing a merger route, a source privy to the development said.

A final call on this is likely to be taken in a month's time.

The source told Press Trust of India that the option of handing over debt-laden MTNL's operations to Bharat Sanchar Nigam Ltd (BSNL) through an agreement is being looked into. The source said that given MTNL's high debt, a merger with BSNL was not a favourable option.