Continued decline in telcos revenue to impact govt collections: Manoj Sinha

Founder & Chairman of Bharti Enterprises Sunil Bharti Mittal with Gopal Vittal CEO of Bharti Airtel and Himanshu Kapania MD of Idea Cellular Limited at meeting with Telecom Minister Manoj Sinha in New Delhi. Photo: Dalip Kumar
Revenue collection from telecom services in form of licence fee and spectrum usage charges may be adversely impacted in the current financial year if sales revenue of operators continues to decline, Union minister Manoj Sinha said on Wednesday.

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 today.

The telecom sector witnessed a sharp decline in revenue in the second half of 2016-17, he said.

"The revenue decline in the second half of 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 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.

"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 per cent 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.

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