The Centre on Wednesday approved a revival package of Rs 1.64 lakh crore for state-owned telecom company Bharat Sanchar Nigam Limited.

The Union Cabinet decided to infuse fresh capital, allocate telecom spectrum and provide sovereign guarantees to enable debt restructuring, according to a press release. It also decided to merge BSNL with Bharat Broadband Nigam Limited in order to augment its fiber network.

“To improve existing services and provide 4G services, BSNL will be allotted Spectrum in 900/1800 MHz band administratively at the cost of Rs 44,993 crore through equity infusion,” the Union Ministry of Communications said. “With this spectrum, BSNL will be able to compete in the market and provide high speed data using their vast network including in rural areas.”

The Centre will provide capital expenditure to BSNL to enable it to meet its projected capital expenditure for the next four years.

The communications ministry added that the government will provide Rs 13,789 crore to the state-owned firm “as viability gap funding for commercially unviable rural wire-line operations done during 2014-15 to 2019-20”.

The merger of BSNL with BBNL with facilitate wider utilisation of infrastructure laid under rural broadband connectivity project BharatNet, the Centre said. “The infrastructure created under BharatNet will continue to be national asset, accessible on a non-discriminatory basis to all the Telecom Service Providers,” it stated.

Union Communications Minister Ashwini Vaishnaw said that BSNL’s balance sheet will be restructured so that the firm becomes a sustainable and viable entity, ANI reported.

“With comprehensive package of Rs 1.64 lakh crore, BSNL will upgrade services, provide high-quality 4G services and immediately advance to 5G services,” he said.

In March, Union Minister of State for Communications Devusinh Chauhan had told the Lok Sabha that BSNL has suffered losses of Rs 50,631 crore in the past five years, according to The New Indian Express.