oppn parties Old Thinking On Telecom Sector Must Go
OPINIONS : Strongly Expressed

January 29, 2023

People Are Talking About

Welcoming 2023

News Snippets

  • RBI governor Shaktikanta Das says that inflation is easing and the current account deficit is manageable
  • Adani Enterprises FPO sees just 1% subscription on the first day as the stock goes down to Rs 2762, much below the price band of Rs 3112-3276
  • Stocks bleed on Friday post the Hindenburg report as Adani stocks are hammered: Sensex loses 874 points to 59330 and Nifty 287 points to 17604
  • Rs 263cr TDS scam detected by the I-T department. A mid-level officer was the kingpin and had amassed huge wealth
  • Women's U-19 World Cup -India reaches the final by beating New Zealand by 8 wickets
  • New Zealand beat India by 21 runs in the first T20 as spinners choke Indian batters
  • Sania Mirza and Rohan Bopanna lose in the Australian Open finals
  • Sania Mirza and Rohan Bopanna lose in the final of the Australian Open
  • India to play New Zealand in the first T20 of the three-match series in Ranchi today
  • RBI has proposed special purpose vehicles (SPEs) mechanism to sell bad loans to interested investors via securitization
  • JD(U) decides not to attend the Bharat Jodo Yatra finale in Srinagar
  • Hindenburg defends its report on the Adani group, dares Gautam Adani to sue it in the US
  • BJP's talks with Tipra Motha in Tripura make no headway but the party is confident of winning in the ensuing elections
  • Pathan is a super hit at the box office: Rs 57cr in India (worldwide Rs 106cr) on Day 1 and then Rs 70cr on Day 2 which was Republic Day holiday
  • Centre tells Delhi HC that Covid vaccines can't be mixed when taking the second dose
A Mirage2000 and A Sukhoi 30 of the Indian Air Force on a training mission crashed separately, in Bharatpur in Rajasthan and Morena in Madhya Pradesh, killing one pilot
oppn parties
Old Thinking On Telecom Sector Must Go

By A Special Correspondent
First publised on 2021-01-11 08:08:29

Given the state of the finances of the telecom companies in India, the high reserve price of spectrum that the government has kept for the ensuing round of auction across seven bands will mean that there will be lesser interest and even if the telcos have no other option but to acquire the spectrum by arranging the funds, they will be further stressed.

Hence, many experts are of the opinion that the government is not right in going for a direct and backbreaking (for the telcos) auction. They suggest that out-of-the-box thinking should have been employed to ensure that the government got the funds but the telcos were not unduly stressed. This is even more important as the 5G spectrum will also be up for grabs in the very near future.

The Economic Times has suggested in an editorial that a few spectrum exchanges could have been constituted and they could have bought the spectrum, while the telcos could have later acquired the same based on need. Although the exchanges would have given them the needed spectrum at a higher price, the telcos would not have had to cough up huge amounts upfront.

This is an eminently sane suggestion and the government must think along these lines. With the Supreme Court order for paying back dues on AGR and with the market not likely to respond favourably to a steep increase in tariffs, the telecom sector is in for a prolonged period of financial stress. Asking it to hoard spectrum at unrealistic prices at this juncture is not right.

The government needs to study the entire scenario of the telecom sector afresh. From licensing to AGR and from spectrum sales to setting the tariff everything needs to be worked out differently in a manner that all stakeholders, including the government, the telcos and the end users, are not impacted adversely. The telecom sector plays a vital role in the development of the nation as communication is a tool needed by all. Hence, it cannot be allowed to remain technologically backward, disintegrate or die a slow death due to high spectrum costs and adverse revenue sharing models.

picture courtesy: the indianwire.com