The government is considering a financial package of Rs 18,515 crore (Rs 185.15 billion) for the state owned Bharat Sanchar Nigam Ltd for providing services in the rural areas.

"The financial support to BSNL to the tune of Rs 18,515 crore for a period of five years, up to the end of 10th Five-Year Plan for providing services in the rural areas is under consideration," Ashok Pradhan, Minister of State for Communication told Lok Sabha.

The financial support includes reimbursement of license fees, spectrum charges and extension of moratorium on repayment of principal and interest on government loans beyond 2004, Pradhan said.

According to sources, the ministry of finance had raised objections to BSNL's package saying that there had to be a level playing field for both private and state-owned service providers.

With regard to rural area obligations, the ministry of finance had said the responsibility should be equally distributed among all service providers including private operators while on the reimbursement of license fee, it favoured providing a level playing field.

It may be noted that recently BSNL, along with MTNL, were forced to roll back a hike in tariffs causing significant loss in revenue.

In such a scenario, BSNL officials said that a financial package was necessary for the corporation to carry out unviable activities like rural telephony.