oppn parties Reforms And Relief For The Telecom Sector

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  • In a first, the Supreme Court recognizes marital rape, although for the limited purpose of allowing married women the right of abortion up to 24 weeks if they conceived as a result of forced sex by their husbands
  • Air India cuts discounts on base fare to students and senior citizens from 50% to 25%
  • Mallikarjun Kharge and Digvijay Singh are being touted as frontrunners to take on Shashi Tharoor in the elections for the post of Congress president
  • Sonia Gandhi will decide who will be Rajasthan CM if she feels there is a need to change guard after the near-rebellion by MLAs in the state
  • Ashok Gehlot bowed out of the race for being Congress president after meeting Sonia Gandhi
  • India has moved to the 40th spot in the innovation index, up 6 spots from last year
  • DGGI has alleged that top insurance companies, banks and NBFCs has committed a fraud of Rs 800cr by claiming input tax credit without underlying supplies
  • The Centre will borrow Rs 10000cr less than planned earlier due to good revenue collections
  • At $23.9bn, India's current account deficit widened to 2.8% in Q1, the worst in four years
  • Stocks continue to flounder on Thursday: Sensex sheds 188 points to 56409 and Nifty 40 points to 16818
  • The 36th National Games were declared open on Thusrday by PM Modi in front of a record crowd in Motera near Ahmedabad
  • Jasprit Bumrah most likely to miss T20 World Cup due to recurrence of back injury
  • PFI's political wing, the SDPI is on EC radar and action will follow soon if discrepancies are detected
  • Ashok Gehlot to meet Sonia Gandhi today, says all issues will be sorted out soon
  • Referring to the PFI ban, most Muslim organizations ask the government to take similar action against right wings organizations like the RSS, Bajrang Dal, VHP and the like
In a landmark order, Supreme Court rules that all women, married or unmarried, are entitled to safe and legal abortion up to 24 weeks of pregnancy as per the MTP Act
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Reforms And Relief For The Telecom Sector

By Linus Garg
First publised on 2021-09-16 03:10:19

About the Author

Sunil Garodia Linus tackles things head-on. He takes sides in his analysis and it fits excellently with our editorial policy. No 'maybe's' and 'allegedly' for him, only things in black and white.

The Union cabinet provided huge relief to the telecom sector by approving several measures that bring in much needed reforms. It has provided a 4-year moratorium on payment of spectrum charges and AGR dues. It has also brought down certain charges and redefined AGR to exclude revenue from non-core business. The telcos were demanding these measures for long and in the wake of the Supreme Court judgment ordering telcos to pay the entire AGR dues in 10 yearly installments, Vodafone-Idea had indicated that it might fold up.

The government was concerned as Vodafone's exit would have left the field open for a duopoly of Reliance Jio and Bharti Airtel (the government-owned BSNL is an insignificant player) in the vital sector. Since Vodafone has the infrastructure and the brand image to survive if could tide over its current difficulties, it was necessary to provide some relief to the sector and ensure that competition among the players would benefit the consumer and not allow just two strong companies to control and manipulate the business.

Further, with 5G on the anvil, if reforms were not introduced and if charges were high, companies would have hesitated in investing the enormous sums required for the transition. In any case, the definition of AGR needed rectification as the government cannot logically claim a share in the non-core business of companies that are licensed to operate telecom services. By now excluding non-telecom revenues from AGR, the government has acceded to the long-standing demand of the sector. If only this realization had dawned some years earlier, the long-drawn out litigation in the Supreme Court could have been avoided and things could have been settled amicably.

Among other measures, interest rates have been reduced and penalties for late payments have been waived. The government said that it would also consider converting the interest burden into equity if the need arises after the moratorium period. The licence period of spectrum has also been extended by ten years. Financial constraints in spectrum sharing, after a lock-in period, have also been removed. It also allowed 100% FDI in the sector through the automatic route, except from China and countries that share a land border.