BSNL defends its reduced funding requirement for 2026-27, citing delays caused by supply chain disruptions, legal hurdles, and administrative challenges, amid rising government allocations for network expansion.
BSNL has pushed back against criticism from the Department of Telecommunications after sharply scaling back its funding requirement for government-backed telecom work in 2026-27, saying the change reflects delays on the ground rather than weak planning. In a response dated 4 August 2026, the state-owned operator said the original estimates were built around Cabinet-approved project schedules, but execution was slowed by supply chain shocks, litigation and administrative bottlenecks across several states.
The dispute centres on the Digital Bharat Nidhi, the telecom funding pool formerly known as the Universal Service Obligation Fund. BSNL had initially sought ₹25,985 crore for connectivity programmes, then saw the estimate trimmed to ₹22,220 crore before repeatedly lowering its requirement between April and July to ₹5,910 crore. That reduction drew a formal complaint from the telecom department, which viewed the revisions as evidence of poor diligence. The budget context is more generous than the revised requirement suggests: the Union Budget for 2026-27 proposed ₹28,473 crore for BSNL, part of a wider increase in telecom spending to support the company’s network expansion and revival. According to Business Standard and Mint, the allocation was intended to fund new 4G sites, viability gap support and other revival measures.
BSNL said several project implementation agencies started late and that advance payments could not be released for some packages because key conditions tied to the main contract were still unmet. It also pointed to billing delays on infrastructure work: contractors have reportedly laid about 40,000 route-kilometres of optical fibre cable, but costs cannot be claimed until contractual milestones are signed off. The company added that securing right-of-way approvals in places such as Kerala, Karnataka and Goa has been difficult, echoing a wider pattern in government digital projects where local permissions often slow spending.
The operator further blamed international disruption, saying conflict involving Israel, the US and Iran had squeezed trade routes and raised the cost of items such as high-density polyethylene ducts, optical fibre and routers. It also cited force majeure conditions and court challenges from unsuccessful bidders as reasons contractors held back from major deployment work. BSNL argued that informing the government early about a lower funding need was prudent financial management, not a retreat from rural broadband goals. That explanation comes as other technology programmes, including schemes under the electronics ministry, have also faced criticism over underspending and budget cuts, underlining how execution gaps can translate quickly into lower-than-expected outlays.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
