Government may withdraw one-time spectrum charge for telecom operators

government may withdraw spectrum charge for telecom operators

If the government reconsiders its stand on a one-time spectrum charge, Airtel and Vodafone Idea may get financial relief of Rs 8,414 crore and Rs 4,390 crore, respectively.

The Indian government is reconsidering its plan on levying a one-time spectrum charge on telecom operators. According to a source, the telecom department is now willing to withdraw legal cases against telecom companies involving disputes of about ₹40,000 crore.

The telecom industry is burdened with liabilities worth around Rs 92,000 crore on adjusted gross revenue after losing the legal battle in the Supreme Court. If the government reconsiders its stand on a one-time spectrum charge, Airtel and Vodafone Idea may get financial relief of Rs 8,414 crore and Rs 4,390 crore, respectively. Both the companies are already making huge losses and have shown their liabilities in their annual reports.

DoT has accepted the fact that the telecom sector is going through a tough financial stress and it is important to take some corrective measures to save the industry from collapsing. It has also raised concerns representing the Indian Banks' Association that adverse developments in the telecom sector may lead to failures, vanishing competition, duopoly, unsustainable operations, and severe losses for the banking system, which loans big amounts to this sector.

The central government is,however, in favor of reviewing and reconsidering its decision to proceed with the present proceedings of appeal. Considering the issue involved, the decision will take considerable time and scrutiny at various levels.