In the Union Budget 2026–27, the government has significantly increased funding for the telecom sector, giving state-owned BSNL a major financial push. With ₹28,473 crore allocated specifically for infrastructure upgrades, the big question is whether this investment can help BSNL emerge as a strong competitor to private telecom giants like Jio and Airtel.
While presenting the Union Budget for 2026–27, Finance Minister Nirmala Sitharaman increased the allocation for the Ministry of Telecommunications from ₹53,000 crore to ₹73,990 crore. This marks a nearly 40% increase in funding for the telecom sector compared to the previous year.
A significant portion of this enhanced allocation has been directed toward strengthening government-owned telecom operator BSNL.
Once again, the government has opened its coffers for BSNL. An amount of ₹28,473 crore has been allocated to the public sector telecom company to improve and expand its infrastructure.
Telecom Minister Jyotiraditya Scindia, while speaking to a news agency, explained that the increased budget allocation will be used across multiple projects, including:
BharatNet rural broadband initiative
BSNL’s capital expenditure requirements
Spectrum-related costs
Network rollout and expansion
Internal operational needs
When asked about the reason behind the higher allocation for BSNL, Telecom Minister Jyotiraditya Scindia said the government is making a focused effort to strengthen BSNL.
This indicates that the government is prioritising network expansion and service improvement at BSNL. If these efforts succeed, the state-run telecom operator could pose serious competition to private players like Reliance Jio and Bharti Airtel in the coming years.
Scindia also highlighted an improvement in BSNL’s financial performance. He said BSNL’s ARPU (Average Revenue Per User) has increased by nearly 9%, rising from around ₹90 to approximately ₹99.
“We would like to reach three-digit ARPU soon,” he said. According to the minister, BSNL has seen revenue growth across all three of its business verticals. However, to fully revive the company, BSNL requires both internal cash flows and this CAPEX injection from the government.
The proposed incremental budget also includes funding for the BharatNet rural broadband project. The telecom minister stated that the government is addressing several critical areas, including:
Spectrum allocation worth ₹1.39 lakh crore for BSNL
Capital expenditure needs such as telecom towers, transmission media, and batteries
Strengthening internal infrastructure to support long-term growth
These measures aim to rebuild BSNL as a competitive and financially sustainable telecom operator.
The budget also includes a significant boost for telecom development in the North-East region. Allocation for the region has been increased from a revised estimate of ₹4,495 crore to ₹6,800 crore, reflecting an almost 50% increase.
This funding is expected to improve connectivity and telecom infrastructure in remote and underserved areas.