COAI seeks measures to improve health of telecom companies
In the letter, COAI states that these concerns have been raised prior as well and the Department of Telecom (DoT) has been informed of them, but very little movement has been done. In fact, many of these reform measures have been delayed.
Telecom operators have approached the government to seek help in sustaining their business. Industry body Cellular Operators Association of India (COAI) has written to the telecom department asking for measures that will ensure the financial viability of their businesses. None of these demands that the COAI has put on the table are new and they are just a reiteration.
In the letter, COAI states that these concerns have been raised prior as well and the Department of Telecom (DoT) has been informed of them, but very little movement has been done. In fact, many of these reform measures have been delayed.
The COAI makes out a case of urgent financial remedies, assistance from the DoT and other various measures. The first amongst those measures is the cumulative regulatory burden in terms of levies be reduced -- the telcos are paying USO funds, SUCs, licence fees and these need to be reduced and rationalised. This was also a part of the national telecom policy rationalisation of dues. So that is, in fact, foremost amongst the demands.
The other demand is floor pricing. That was in fact one of the demands made by Kumar Mangalam Birla, in his letter to the cabinet secretary.
Another key concern that has been raised is a need for a moratorium. So far there has been a moratorium allowed for two years. The telcos, the COAI seeking an extension of that from 7 to 10 years. The other demand is doubling of spectrum holding period from 20 to 40 years. They have also asked for a progressive definition of AGR, which currently includes telecom revenues as well as non-telecom revenues. They want a progressive definition of AGR which would only include telecom revenues going forward. That's a prospective adjustment that COAI is seeking.
They are seeking remedies with respect to bank guarantees in terms of compliance burden that is cast on these companies in terms of audits. So a whole host of demands sought by the telcos and the COAI.
The telecom sector, the COAI are making a fervent appeal once again, before the DoT for this urgent relief that is sought from the health of the telecom sector. However, there is no official confirmation on whether any relief package or measures are likely to be announced.
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