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COAI says SPV proposal nixed due to lack of consensus; govt not involved

"Unfortunately, the proposal did not pass the test of internal scrutiny among the telcos, so we will have to come up with a different proposal," Rajan Mathews, DG, COAI, told ET. The COAI also clarified that neither the government nor the DoT was in any way involved in the plan which was only meant for internal scrutiny among the members of the association.

, ET Bureau|
Last Updated: Jan 23, 2020, 12.06 PM IST
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Telecom operator association (COAI) said its proposal to set up a Special Purpose Vehicle (SPV), to aid the financially strained sector has been nixed as one of telcos was not on board with the plan. It added that the government was not involved in the proposal.

"Unfortunately, the proposal did not pass the test of internal scrutiny among the telcos, so we will have to come up with a different proposal," Rajan Mathews, director general of the Cellular Operators Association of India (COAI) told ET.

The COAI also clarified that neither the government nor the Department of Telecommunications (DoT) was in any way involved in the plan which was only meant for internal scrutiny among the members of the association.

"This is not a government proposal, but an internal industry discussion on possible ways to address the financial distress of the industry," said Mathews. " Work - in - progress discussions within the Association should not be construed as Government proposals."

According to a media report, the tentative proposal included creating an SPV which will have equity share of the telcos in the ratio of Airtel (32%), Vodafone Idea (31%), Reliance Jio (31%) and BSNL (6%), in lieu of license and spectrum payments of Rs 4,83,000 crore, which they will make over to period of 15 years to the SPV, instead of the government. The telcos will also pay their old adjusted gross revenue (AGR) dues to the tune of Rs 1,20,000 crore to the SPV in annual installments.

The report also said, "the government may give spectrum worth Rs 1,46,700 crore to the SPV free of cost without any auction," where all operators will have equal and non-discriminatory access to ubiquitous 5G network."

"Ideas such as reduction in LF (License Fee) and SUC (Spectrum Usage Charge) have been requested by the industry for several years. The idea of an SPV fo networks has also been discussed in multiple public forums. The only novel part is to put it all together in a comprehensive proposal," Mathews said.

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