The Centre is considering to establish a special purpose vehicle (SPV) to help the struggling telecom sector, Business Standard reported.
The report cited a communication sent by the Cellular Operators’ Association of India (COAI) to its member companies.
Telecom players will be asked to pay their Adjusted Gross Revenue (AGR) dues, estimated at over Rs 1 lakh crore, to the SPV in annual instalments, the report said. These payments will be treated as a contribution towards equity.
The SPV might also finance the roll out common 5G network which can be used by all telecom service providers.
Under the proposal, the government will no longer affect annual licence fee (LF) and spectrum usage charge (SUC) from service providers. Operators will pay LF and SUC to the SPV for the next 15 years in exchange for equity.
The government itself will contribute Rs 2.5 lakh crore to the SPV to obtain equity, the report added.
The industry has been “asked to provide inputs for a proposal to reduce the financial stress for telecom sector,” COAI said in its message to its members. The industry lobby sent this communication after an interaction with senior government officials.—Money Control