MTNL Loan Defaults Increases to ₹8,659 Cr Amid Govt’s Revival Bet

Government-owned telecom company Mahanagar Telephone Nigam (MTNL) posted an increase in its loan defaults to public sector banks, including Union Bank of India, Punjab National Bank, and Bank of India. The company in an exchange filing said its outstanding dues increased to ₹8,659 as of July 31, 2025 from ₹8,584.93 crore on June 30, 2025. The ₹8,659 crore debt as of July, comprises of ₹7,794.34 crore in principal and ₹864.75 crore in interest, the telecom company said. 

Its total financial debt at the end of July stood at ₹34,577 crore compared to ₹34,484 crore in the previous month. The debt comprises ₹8,659 crore in bank loans, ₹24,071 crore in Sovereign-guaranteed bonds, and ₹1,921 crore in loan from department of Telecommunications (for bond interest).

This comes around a time when the government is considering ways to revive state-run telecom companies, including MTNL and BSNL. The Prime Minister Narendra Modi-led government planned to raise around ₹1,000 crore in the financial year 2025-26 to reduce debt-burden and improve liquidity, MoneyControl had earlier reported. To raise funds, the government was reportedly considering using land parcels owned by the two telecom companies. 

“BSNL has two or three land parcels under consideration. The total land value from both BSNL and MTNL is approximately ₹1,000 crore, which is likely to be monetised this year,” MoneyControl reported, citing an official source. “Land is not an easy subject. It is a state subject. All the documents, everything has to be in place,” the official added. 

Additionally, a high-level committee has drawn up a framework for the transfer of surplus land and buildings of telecom PSUs BSNL, MTNL and ITI to central government organisations without auction, PTI reported last month. The proposal regarding the same was cleared up at a meeting of the Committee of Secretaries in June this year.