The board of Mahanagar Telephone Nigam Limited (MTNL) has been given more powers to enable it to speed up decision making process and to run the company in view of the competition from private operators. This has been reported by a leading national daily.
MTNL (FY99 Revenues: Rs 52.47 bn), a public sector company, is a franchise of the Department of Telecom. The company has a 15-year telecom license to operate in New Delhi and Mumbai until the year 2013.
The move is in line with the government's plan to give more autonomy to the public sector units that have been christened as 'navaratana' by the government. The company will now be able to purchase equipment, set tariffs, form joint ventures among other things without needing an approval from the government. The government's decision is likely give the board the much needed independence in the decision making process to enable it to proactively take on competition.
MTNL has been unable to take on competition in its circles of operations mainly due to the delays in getting approvals for the new measures it wants to initiate. The new powers will now put the onus, for the first time, on the board of directors and dilute the excuse that the government is delaying the approval.
MTNL is now 'starting a new life' according to the company's chairman. Whether it will be able to capitalise on the opportunities thrown up by this move of the government a yet remains to be seen.
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