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Government Working On Revising Spectrum Prices

In a big relief for the telecom sector reeling under financial stress, Union Minister Ravi Shankar Prasad said that the government was alive to the industry’s problems and working on revising spectrum prices

In a big relief for the telecom sector reeling under financial stress, Union Minister Ravi Shankar Prasad said that the government was alive to the industry’s problems and working on revising spectrum prices — dubbed as exorbitant and unaffordable by service providers. The Minister also announced that spectrum auctions, including for 5G airwaves, will be held in the current financial year.

“As government, we have sought to create a favourable atmosphere for telecom companies to operate. We are alive to your problems. We are working out…that you remain a productive asset and not a non-productive asset,” the Minister, who holds the portfolio for Communications, IT and Law and Justice, said while speaking at the inaugural session of the India Mobile Congress.

Mr. Prasad added, “As far as spectrum is concerned, let me announce that spectrum auctions will be done in this financial year. As regards spectrum pricing, let me say that we are in the process of undertaking some reform in the spectrum pricing as well. Please wait for the result.”

Speaking at the inaugural session, Mahendra Nahata, director on Board of Reliance Jio, stated that prices of 5G spectrum should be “critically” relooked at, along with predictable spectrum availability. “Timely availability of spectrum is one of the key requirements of the mobile communication industry… The long delays between the spectrum auctions should end…spectrum should be made continuously available to the industry between the two auctions at the price determined during the last auction,” he said.

Mr. Nahata added that higher floor prices would render 5G networks unviable and was therefore getting delayed. An equilibrium needed to be established between government revenue and overall growth, he said.

Vodafone Idea chairman Kumar Mangalam Birla sought an ‘enabling regulatory’ environment.

Highlighting the financial stress in the sector, Bharti Enterprises vice-chairman Rakesh Bharti Mittal said “endless litigation” also added to the stress for the sector. “We need to improve ease of doing business. There is about ₹1 lakh crore worth of litigation that needs to be settled. GST credit needs to be unlocked. We need to have more conducive regulatory environment,” Mr. Mittal said.

Mr. Mittal pointed out that there was a need to bring cost of doing business down, making a case for reduction in levies such as licence fee, spectrum usage charge and customs duty on imported telecom equipment.

“While we need large quantities of spectrum, we need it at the right price. Currently, the reserve price recommended by TRAI is significantly higher compared with global [trends]. This high price is going to take a toll on the telecom sector,” Mr. Mittal said.

Biggies skip event

The third edition of the India Mobile Congress was a bit dull compared to the earlier two. Bharti Airtel chairman Sunil Bharti Mittal and Reliance Industries chairman Mukesh Ambani gave the event a miss.

Interestingly, the children of Mr. Mittal and Mr. Ambani too skipped the event. Kavin Bharti Mittal, along with Isha Ambani and Akash Ambani, who were to speak at a session on ‘Leaders for the Next Generation’ did not come for the event. Similarly, Ananya Birla and Rishad Premji, who were also to speak at the event, did not turn up.

Among major telecom firms, South Korean technology giant Samsung did not participate in the event this year.―The Hindu

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