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Union Cabinet passes plan to ease financial stress in Telecom sector

Thursday, 21 Nov 2019
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The Union Cabinet chaired by Prime Minister Narendra Modi has approved the proposal for mitigating financial stress being faced by the Telecom Services sector.

The Department of Telecommunications will give an option to the Telecom Service Providers (TSPs) to defer payment of the spectrum auction instalments due for 2020-21 and 2021-22, either for one or both years.

These deferred amounts bill be spread equally in the remaining installments to be paid by TSPs. Interest as stipulated while auctioning of the concerned spectrum will however be charged so that net present value (NPV) is protected. The deferment of spectrum auction installments will ease the cash outflow of the stressed TSPs and facilitate payment of statutory liabilities and interest on bank loans.

The continued operation by TSPs will give a fillip to employment and economic growth. Improved financial health of TSPs will facilitate maintenance of quality services to consumer. The decision for deferring spectrum payment installments for two years will be implemented within two weeks.

An amendment to the License will be issued expeditiously with the approval of Ravi Shankar Prasad, Union Minister of Communications.

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