MUMBAI: A telecom Goliath has tripped on its own cables. Mahanagar Telephone Nigam Limited (MTNL) has rung the wrong number with its bankers. The state-owned telco has officially defaulted on a jaw-dropping Rs 8,346 crore worth of loans—putting the “broke” in “dial tone broke”.

While the rest of the world streams 4K videos and binge-watches on blazing fast connections, MTNL seems to be buffering… financially.

On 19 April, MTNL told the bourses that it has failed to cough up both the principal and interest on loans taken from not one, not two, but seven state-run banks. Talk about spreading the love—and the liability.

The missed payments include overdue interest worth Rs 551.90 crore and unpaid principal of Rs 1,635.39 crore. In total, it owes Rs 8,346.24 crore to the likes of Union Bank of India, Bank of India, Punjab National Bank, State Bank of India, UCO Bank, Punjab & Sind Bank, and Indian Overseas Bank. Every bank gets a slice of the default pie.

The financial plot thickened with MTNL's relationship with Union Bank of India turning sour on 12 August 2024, where a hefty Rs 3,334.57 crore in principal remained unpaid, and Rs 298.85 crore in interest hung in the air.

Things didn’t improve—by 4 September 2024, Bank of India found itself on the default roster too, owed Rs 999.54 crore in principal and Rs 77.80 crore in interest.

A few days later, on 9 September, Punjab National Bank's dues followed suit, with Rs 432.16 crore in principal and Rs 32.10 crore interest unpaid.

Come 28 September, State Bank of India and UCO Bank were both ghosted by MTNL, left with mounting dues and no callbacks. Then, on 8 October, Punjab & Sind Bank got stood up.

Eventually, Indian Overseas Bank met the same fate on 3 February 2025, sealing MTNL’s full-blown debt drama.

The situation isn’t just a few late EMIs. MTNL’s total financial baggage weighs in at a staggering Rs 33,568 crore, including Rs 8,346 crore in bank loans, Rs 24,071 crore in sovereign-guaranteed bonds, and a Rs 1,151 crore loan from the Department of Telecommunications just to pay interest on those bonds.

That’s like borrowing money to pay the interest on money you borrowed to pay interest.

Shakespeare would call this tragedy.

Accountants call it Thursday.

Despite this financial sinkhole, the company has maintained a straight face in its compliance filing with the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), stating only that it's defaulted, and here’s the Excel sheet to prove it. Bureaucratic honesty, if nothing else.

The question now is: what next? Will the Department of Telecommunications come riding in with a fresh bailout cheque and a stern frown? Or is MTNL setting the stage for another round of disinvestment drama?

For now, shareholders are left listening to static, and taxpayers are once again left wondering whether the “public” in public sector means “publicly funded bailouts” on loop.