Inter-ministerial panel to discuss recommendations on measures to provide relief to the stressed telecom sector

The Indian telecom industry, which is in the midst of an intense tariff war, owes a staggering Rs 4.6 lakh crore to various financial institutions and banks.

Inter-ministerial panel Telecom Commission is scheduled to meet on Friday to discuss the recommendations of a committee on financial stress in the sector, an official source said. "Telecom Commission will meet on September 29," an official source, who did not wish to be named, told PTI. When asked if the inter-ministerial groups recommendations on the telecom sector will be discussed, the official replied affirmatively and said there are some other important pending issues that will come up for the discussion.

Representational image. Reuters

Representational image. Reuters

In last meeting held on September 8, the commission had postponed a decision on measures to provide relief to the stressed industry as it sought more details on some of the suggestions, including deferred spectrum payment liability. The IMG -- tasked with finding a remedy to the financial difficulties of the telecom sector -- had recommended that the payments for spectrum purchased in auctions be made in 16 installments (16 years) as against the current practice of 10 years.

The IMG had also favoured a cut in interest rates on penalties by switching from PLR based to MCLR based rate, which could provide relief of about two percentage points in the current situation. The Indian telecom industry, which is in the midst of an intense tariff war, owes a staggering Rs 4.6 lakh crore to various financial institutions and banks. Old telecom operators have blamed their declining margins to tariff war triggered by entry of Reliance Jio about a year ago.

Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.




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