Revenue collection from telecom services in form of licence fee and spectrum usage charges may be adversely impacted in the current fiscal if sales revenue of operators continues to decline, Union minister Manoj Sinha said. The telecom industry, including state-owned firms, and major banks have apprised the government about the financial stress, the telecom minister informed the Lok Sabha. The telecom sector witnessed a sharp decline in revenue in the second half of 2016-17, he said. Also Read - Vodafone CEO Nick Read to visit India this week; will seek bailout: ReportAlso Read - BSNL agrees to lay off 54,000 employees, but waiting for elections to be over: Report
“The revenue decline in the second half of the financial year 2016-17 was mainly concentrated in the last quarter of the year. The declining tariff in the sector led to an adverse impact on revenue. The License Fee has declined in Q3 (October-December) and Q4 (January-March) of the financial year 2016-17,” Sinha said.
As per the data shared by Sinha, at the end of first quarter government collected licence fee of Rs 3,975.66 crore, Rs 3,584.04 in second, Rs 3,452.13 crore in third and Rs 2,663.29 crore in the last quarter. ALSO READ: Telecom M&As mean better spectrum utilization, services: Manoj Sinha
“If this trend continues, the License Fee and the Spectrum Usage Charges are likely to be impacted adversely during the current financial year,” Sinha said.
Operators pay 8 percent of their telecom services revenue as licence fee to the government. The minister said that an inter-ministerial group (IMG) has been set up by the government with representatives from Department of Telecommunications, Department of Financial Services, Department of Economic Affairs and Department of Revenue.
The role of the IMG is to examine systemic issues affecting viability and repayment capacity in telecom sector and furnish recommendations for resolution of stressed assets. The panel has to suggest policy reforms and strategic interventions for the telecom sector, he said.