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Govt forms committee of secretaries to explore financial bailout package for telecom sector

30 Oct 2019 Evaluate

The Department of Telecommunications (DoT) said that the government has formed a committee of secretaries to explore a financial bailout package for the telecom sector by lowering spectrum charges as well as ending the era of free mobile phone calls and dirt cheap data as companies look at the government for avoiding payment of thousands of crores of rupees in overdue statutory levies.

The committee, formed under Cabinet Secretary Rajiv Gauba, has been asked to examine all aspects of financial stress faced by service providers and suggest measures to mitigate them. The panel, which will comprise secretaries to the ministries of finance, law, and telecom, has been asked to look at the demands of telecom service providers (TSPs) for deferment of payments they had promised for the spectrum won through auction as well as consider lowering airwave usage charge. The panel will also consider lowering the obligation of TSPs for providing 5 percent of their annual revenues for the Universal Service Obligation Fund (USOF).

In similar, Telecom Regulatory Authority of India (TRAI) is expected to examine prescribing minimum charge for voice and data services, which according to old telecom operators will ensure long-term viability and robust financial health of the sector. The government's decision to form a committee comes a day after an unsigned paper seeking a waiver of interest and penalties on the unpaid amount, as well as staggering payment of principal licence fee over 10 years was submitted to the DoT. 

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