Indian operators applauded what they called pioneering reforms in a relief package announced by the government designed to nurture the telecoms sector back to financial health.
The government yesterday (15 September) approved a wide range of structural reforms, which the Telecommunications Regulatory Authority of India (TRAI) tweeted would provide a major boost to the sector.
TRAI tipped the move to “catalyse further investment in next-generation technologies”.
The controversial definition of adjusted gross revenue (AGR) was modified, with non-telecoms revenue now to be excluded. Spectrum usage charges (SUCs) will be dropped for future auctions, and the interest rate on licensing fees and SUCs will be reduced.
India will also encourage spectrum sharing by removing a related additional 0.5 per cent SUC.
The duration of spectrum licences was increased from 20 to 30 years and a requirement for bank guarantees to secure instalment payments for future auctions was dropped
Nick Read, CEO of Vodafone Idea’s largest shareholder Vodafone Group, stated in a stock market filing it expects the initiatives will be “the beginning of a new era for India’s digital ambition”.
Aditya Birla Group chair Kumar Mangalam Birla added the reforms will help unshackle the telecoms sector while demonstrating the government’s commitment to the industry.
He previously resigned as chairman of Vodafone Idea, after suggesting selling its 27 per cent stake.
Mukesh Ambani, chair of Reliance Jio parent Reliance Industries, welcomed the relief measures, stating they will boost a Digital India programme in addition to the mobile market.
Bharti Airtel chairman Sunil Mittal stated it it had a “once in a lifetime opportunity to build the digital infrastructure that is a catalyst for the digital aspirations of over 1 billion Indians”.
But Gopal Vittal, MD and CEO of the operator’s India and South Asia unit, suggested more needs to be done to deliver “a sustainable tariff regime to ensure the industry gets a fair return”, to fuel investments.