In her Union Budget 2026 speech on February 1, 2026, Finance Minister Nirmala Sitharaman proposed a massive ₹28,473 crore equity infusion for BSNL (Bharat Sanchar Nigam Limited).
This “booster dose” is the primary driver behind a 38% hike in the overall outlay for the Ministry of Communications, which now stands at ₹73,990 crore for FY2026-27.
1. The ₹28,473 Crore “Capital Injection”
The allocation marks a sharp increase from the ₹6,885 crore revised estimate (RE) of the previous year, signaling the government’s commitment to seeing BSNL’s revival plan through to completion.
- Equity Infusion: The bulk of the funds (₹28,473 crore) is earmarked as direct equity to strengthen the company’s balance sheet.
- Total Support: Including viability gap funding (₹1,200 crore) and voluntary retirement (VRS) payouts (₹476 crore), the total financial package for BSNL reaches ₹30,188 crore.
- Strategic Shift: Telecom Minister Jyotiraditya Scindia noted that BSNL’s Average Revenue Per User (ARPU) has grown by 9% to ₹99, and this capital injection is the “fuel” needed to push that figure into triple digits.
2. 4G Expansion & 5G Readiness
The fresh funding is strictly tied to aggressive network expansion targets as BSNL attempts to claw back market share from private giants like Jio and Airtel.
- 23,000 New Sites: BSNL is tasked with deploying 23,000 additional 4G sites in FY27, building upon the 100,000 sites already being rolled out via the TCS-led “Swadeshi” consortium.
- Indigenous Tech: The rollout continues to utilize homegrown technology from TCS, Tejas Networks, and C-DoT, reinforcing India’s “Aatmanirbhar” (self-reliant) telecom goals.
- Infrastructure Overhaul: Beyond towers, the funds will be used to modernize transmission media, upgrade battery systems, and strengthen the fiber backbone.
3. Synergies with BharatNet
The BSNL allocation works in tandem with the ₹1.39 lakh crore sanctioned for the Amended BharatNet Program:
- Rural Backbone: BSNL will act as the primary “coverage engine” in low-ARPU rural markets, utilizing the BharatNet fiber to provide high-speed broadband to Gram Panchayats.
- North East Focus: The budget for telecom development in the North East saw a 50% jump (to ₹6,800 crore), where BSNL’s role is critical for providing connectivity to remote and strategically sensitive areas.
4. Performance Targets for FY27
To ensure accountability for the ₹28,473 crore infusion, the government has set specific growth benchmarks for the state-run telco:
- Mobile Services: Targeted 50% growth in the subscriber base and usage.
- Enterprise Business: Growth goal of 25–30% by targeting government and SME contracts.
- Fixed-Line (FTTH): Expected expansion of 15–20% as urban and semi-urban fiber demand rises.
Conclusion: A Bet on Resurgence
By increasing the BSNL outlay by over 300% compared to last year’s revised numbers, the 2026 Budget transforms BSNL from a “stabilization” project into a “growth” engine. While private players focus on high-value 5G densification in cities, the government is positioning BSNL to dominate the rural digital landscape. As the company reports its first consecutive quarterly profits in nearly two decades, this ₹28,473 crore infusion represents the final push to make BSNL a permanent, competitive force in Indian telecom.
