Government of India

Ministry of Communications

Rajya Sabha

Starred Question No. 269

Answered on 12^th December 2019

Financial Crisis Faced by Telcos

*269. SHRI RAJEEV CHANDRASEKHAR:

Will the Minister of COMMUNICATIONS be pleased to state:

(a)Whether Government is aware of recent press statements by some telcos about claims of financial crisis; and

(b)Whether Government has undertaken any study about this so called crisis and its impact on consumer pricing and competition?

ANSWER

Minister of Communications. Law and Justice & Electronics and Information Communications

(Shri Ravi Shankar Prasad)

(a)and (b) A statement is laid on the Table of the House.

STATEMENT TO BE LAID ON THE TABLE OF RAJYA SABHA IN RESPECT OF PARTS (a) & (b) OF THE RAJYA SABHA STARRED QUESTION NO. *269 FOR 12TH DECEMBER, 2019 REGARDING “FINANCIAL CRISIS FACED BY TELCOS”.

(a)and (b) Yes Sir.

The Department of Telecom has held a number of meetings with the Telecom Service Providers in the recent past, regarding the issues faced by the Telecom Sector. A Committee of Secretaries (CoS) chaired by Cabinet Secretary also considered issues related to Telecom Sector. Based on the recommendations of the CoS, the Government has permitted deferment of the payment of the spectrum auction instalments due for 2020-21 and 2021-22 for mitigating the financial stress being faced by the telecom Services Sector, whereby, Department of Telecommunications will give an option to the Telecom Service Providers to defer payment of the spectrum auction instalments due for 2020-21 and 2021-22, either for one or both years. These deferred amounts will be spread equally over the remaining instalments to be paid by Telecom Service Providers, without any increase in the existing time period specified for making the instalment payments. Interest as stipulated while auctioning of the concerned spectrum will, however, be charged so that NPV of the payable amount is protected. As per the current policy, the Telecom Service Providers will continue to securitize the next payable annual instalment by a Financial Bank Guarantee (FBG) of an amount equivalent to the instalment.

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