New Delhi: The fallout of the Supreme Court’s decision on a decades-long claim over how much India’s telecom operators owe the government in various fees and charges has been swift and ugly.
The apex court has said that the dues, which amount to Rs 1.3 lakh crore for the whole industry, need to be paid in three months.
On Tuesday morning, in an unprecedented move, Bharti Airtel was forced to delay its September quarter earnings report to November 14, as it said it had to weigh the impact of the apex court’s judgment.
The Wire’s analysis has indicated that the total dues on Airtel till March 2017 come out to be about Rs 50,000 crore while Vodafone-Idea will have to pay about Rs 40,000 crore.
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Shares of New Delhi-based Airtel dropped as much as 4.22% in morning trading on Tuesday while smaller rival Vodafone Idea Ltd fell by up to 9.52%.
On Tuesday afternoon, sources said the Department of Telecommunications (DoT) considered submissions put forth by the telecom industry, an array of pleas and recommendations that were hastily cobbled together by the operators over Diwali weekend.
Government sources tell The Wire that a Committee of Secretaries (CoS), a popular bureaucratic method of deliberation in the Narendra Modi government, will “examine all aspects and suggest measures to mitigate the financial stress being faced by the telecom sector”.
The CoS will function under the Cabinet Secretary.
“Representations have been received from major telecom service providers regarding the financial stress being faced by them. Future commitments for payments of spectrum purchased by TSPs and the license fee including the contribution to Universal Service Obligation Fund (USOF) have been cited as issues which require to be looked into,” DoT sources said.
The CoS, according to sources, will examine:
1) The demand of TSPs for deferment of spectrum auction payment due from TSPs for the years 2020-21 and 2021-22 in order to ease the cash flow situation of the Industry.
2) A re-look at the USOF charge which is currently at 5% while the TRAI in their earlier recommendations have suggested for reduction of this charge to 3%.
3) The request of telecom service providers for reduction of spectrum usage charges (SUC) may also be examined.
“In parallel, it is expected that the TRAI will also examine the aspect of minimum charge for voice and data services to ensure that the financial health of the telecom sector remains robust and viability is sustained. The CoS is expected to meet shortly and submit their recommendations in a time bound manner,” sources said.
