The government on Friday downplayed any job loss in the telecom sector saying it is a part of the current consolidation in the industry while refusing to intervene in the dynamics beyond a point.
Recently, reports of about 1.5 lakh job loss in the telecom sector made headlines . The job losses were reported under the pressure from large loans and losses to telcos with some even mulling exit. But Telecom secretary Aruna Sundararajan said there are no significant job losses. She was very bullish about the prospects of India’s telecom sector in the long-term horizon driven by the surging demand for data. “There is consolidation. People are trying to merge. People are saying there is financial strife, but no one is saying there is huge joblessness,” she said.
She said data held a bright prospect for the Indian telecom sector amidst the stress. “The current situation is a temporary phenomenon. We haven’t even begun to scratch the surface in terms of data. Data explosion has just begun. The medium and long-term prospects of the industry are very robust,” Sundararajan said at a discussion at the India Economic Summit 2017.
She added that the government was aware of the financial strife in the industry but won’t intervene beyond a point. “The government will play the role of an enabler and make sure it’s a level playing field. The rest will be left to the players,” she said. Stressed by low profits, industry observers say, telecom companies have downsized to initiate severe cost-cutting measures to survive. The figures, as per trade sources are between 20,000-25,000 direct job losses as a result of planned mergers between players. Mergers alone could lead to over 15,000 job losses as existing portfolios and profiles are duplicated and to maintain lean organisations, telcos go for lay-offs.