"In view of the current financial stress faced by major telecom service providers and in pursuant of the recommendations by Committee of Secretaries, it is decided to defer receipts of spectrum auction installments due from the telecom service providers from the years 2020-21 and 2021-2022," Finance Minister Nirmala Sitharaman Wednesday said.
The deferred amounts, according to Sitharaman would be equally spread over the remaining installments.
"These deferred amounts bill be spread equally in the remaining installments to be paid by telecom companies. Interest, as stipulated while auctioning the concerned spectrum, will, however, be charged so that NPV is protected, the government in a statement said.
However, telecom companies opting for a two-year deferred payment would have to furnish a bank guarantee.
Deferment of spectrum auction installments would ease the cash outflow of the stressed telcos and facilitate payment of statutory liabilities and interest on bank loans.
Continued operation by telecom service providers, according to the statement, would give a fillip to employment and economic growth. In addition, the improved financial health of service operators would facilitate the maintenance of quality of services to the consumer.
Following the Rs 1 lakh crore worth of Q2 loss by telcos, the Centre had formed a Committee of Secretaries to look into relief package to the ailing sector.
The recent adverse Supreme Court ruling mandating the telecom companies to pay up outstanding to the Department of Telecommunications (DoT) within three months, coupled with the existing cumulative debt of Rs 7.5 lakh crore, has made the incumbents heavily strained.
Indian telecom operators owe the government nearly Rs 1.47 lakh crore in license fee (LF) and spectrum usage charges (SUC), the communications ministry told the Parliament Wednesday. Of the total amount, license fee comes to Rs 92,642 crore as of July this year, while SUC comes to Rs 55,054 crore as of October end this year.
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70 Comments on this Story
Priya377 days ago
It is not guaranteed that they will be paying telecom money after 2 years because they have already bad conditions for a few years and till now not to recover so how can they say that. I do not agree with this and I don''t think so.
Swabhanu Mysore Venkataramaiah378 days ago
ANOTHER JHUMLA ! MORATORIUM ''WITH INTEREST PAYMENT'' ! STUPID IDEA BY THE ''I KNOW ALL'' BRAINS RUNNING OUR COUNTRY. O.K., INTEREST CHARGES, DONE. BUT AT WHAT RATE ? LIBOR WHAT ? THESE GUYS CAN REALLY AFFORD TO BORROW AT MIN. LIBOR RATES & PAY OFF THE GOVT., INSTEAD OF PAYING ''INDIAN'' RATES OF INTEREST TO OUR GOVT. THERE ARE MANY PROVERBS TO FIT THIS ''JOKE'' IN KANNADA - LIKE ; SHOW ''GIVING'' BUT ''DON''T GIVE'' (ANYTHING) !
RAVINDHRA A378 days ago
@ JA wauddin Shaikh.. Got million profit?! Kindly don''t make public Speculative Comments on news feeds! Every news cannot bring up or down the stocks in the market. Market will respond its own way. Wise Ness is in keeping calm and observing the market in response to the news. Your kind of Comments without basic knowledge of markets will dwindle some innocent traders. So help them by not commenting without a valid reason