Cabinet more likely to take up telecom reduction package deal in the present day; cuts in SUC, licence charge

The Union Cabinet on Wednesday is more likely to take up for discussions and approval a reduction package deal for the telecom sector, sources in know of the event advised The Indian Express.
Among the reduction measures being mentioned, there’s the chance {that a} discount within the spectrum utilization fees (SUC) and licence charges might be cleared. Currently, telecom service suppliers pay round 3-5 per cent of adjusted gross income (AGR) as SUC, whereas they pay round 8 per cent of the AGR as licence charge.
“There is some scope in the SUC being reduced to 3 per cent flat, and the licence fee being halved. It is under consideration,” a authorities official stated.
Apart from these, the funds for spectrum purchases, which had been deferred for as much as two years (2020-21 and 2021-22) in 2019 can be more likely to be prolonged for as much as most interval of 5 years, whereas the spectrum holding interval, which is at present 20 years, possibly prolonged past that, the officers stated. Among the three personal gamers, each Vodafone Idea (Vi) and Bharti Airtel have been searching for some form of reduction for the sector from the federal government within the type of discount within the levies paid by telcos, particularly license charge and spectrum utilization fees, in addition to some waiver on the discount of the rates of interest for dues to be paid to the Department of Telecommunications (DoT).
The two corporations have sought these reliefs particularly after the Supreme Court’s judgment on AGR, wherein the apex court docket had stated that the definition of AGR put forth by the DoT was appropriate, and that telcos must pay the dues of the previous 20 years.
Following the Supreme Court’s judgment on AGR, the previous non-executive chairman and director of Vi, Kumar Mangalam Birla, had stated that his firm must “shut shop” if no reduction was forthcoming from the federal government. Birla’s feedback had then come practically a fortnight after the worldwide CEO of Vodafone Nick Read made comparable feedback.
Read had on November 12 that yr stated the agency’s future in India was uncertain and the corporate might be headed for liquidation if there was no reduction from the fee of AGR dues. He had added the worldwide arm wouldn’t commit any extra fairness for India because the nation “effectively contributed zero value to the company’s share price”. In June, Birla had, in a letter to the Central authorities, provided to “hand over” his 27 per cent stake within the firm to any public sector, authorities, or home monetary entity or to another agency that the federal government might imagine match, to maintain Vi going. Earlier this month, Birla, together with Read had additionally met Telecom Minister Ashwini Vaishnaw and mentioned the well being of the sector.