BSNL to cut 19,000 jobs with VRS 2.0

The telco is planning to cut high salary costs by INR 2,500CR, keeping a budget of INR 5,000CR for employee salaries.
Bharat Sanchar Nigam Ltd. (BSNL), India’s government-owned telecom company, is planning to cut approximately 35 per cent of its workforce, according to various media reports.
The planned workforce reduction, allowing employees to choose early retirement in exchange for a financial package, is part of a strategic cost-cutting initiative, and the Department of Telecommunications (DoT) has sought approval from the Finance Ministry for a second Voluntary Retirement Scheme (VRS) to streamline operations.
Reportedly, the telco’s board has approved VRS 2.0 to cut costs, noting that they have yet to roll out 4G services nationwide. However, a senior official denied this, saying that the VRS 2.0 plan is still being brainstormed and the decision is pending.
Interestingly, the news of BSNL seeking INR 15,000 Crores (CR) support to cover the cost of rolling out VRS 2.0 has emerged. As an anonymous spokesperson told the media, 'BSNL's board has sent a proposal to the DoT to reduce the telco's employee base by 18,000 to 19,000 via a VRS to make its balance sheet healthy.”
The report added that BSNL’s current employee salaries amount to INR 7,500CR, i.e., 38 per cent of its total revenue. Therefore, the telco is planning to cut high salary costs by INR 2,500CR, keeping a budget of INR 5,000CR for employee salaries.
Currently, BSNL reported a revenue of INR 21.3 CR in the 2023-24 fiscal year, reflecting an improvement as compared to previous years. And this is not the first time the telco has rolled out such a scheme. A revival package in 2019 worth INR 69,000CR was approved to support BSNL and Mahanagar Telephone Nigam Limited (MTNL), which included early retirement programmes opted by over 90,000 employees. The scheme cost INR 17,500CR in ex-gratia payments to laid-off employees.
Later, the government rolled out two more revival packages, one of INR 1.64 lakh crore for de-stressing BSNL’s balance sheet and accelerating 4G rollout, and another one of INR 89,000CR for 4G and 5G spectrum acquisition.