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Cabinet gives nod for new telecom policy; clears path for spectrum price, licence fee review

The policy also aims to boost the telecom sector's contribution to 8% of GDP from 6% in 2017.

Mail Today Bureau   New Delhi     Last Updated: September 28, 2018  | 16:01 IST
Cabinet gives nod for new telecom policy; clears path for spectrum price, licence fee review

The Cabinet on Wednesday approved the new telecom policy that sets an ambitious target of attracting $100 billion investments and creating 40 lakh jobs in the currently debt-ridden sector by 2022 and paves the way for introducing new technologies such as 5G and IoT (Internet of things).

"The government felt the need to come up with a new telecom policy that is both customer-focused and application-driven, given the pace of global transformation in the sector, particularly, in emerging technologies such as 5G, IoT (internet of things) and M2M (machine to machine) communications," telecom minister Manoj Sinha said.

Under the new policy, termed the National Digital Communications Policy 2018, the government plans to optimally price spectrum, review levies such as license fees and spectrum usage charges (SUC) as well as M&A rules to ease exits while also taking a fresh look at spectrum sharing, leasing and trading guidelines, as part of its approach that spectrum is a key natural resource which is to be used for public benefit.

The policy also aims to boost the telecom sector's contribution to 8% of GDP from 6% in 2017, besides backing the principles of net neutrality. The Telecom Commission, the highest decision making body in the telecom department (DoT), will "from now onwards be called the Digital Communication Commission," the minister said.

The new policy, he said, would give a thrust to the entire telecom sector and ensure the financially stressed industry "is not merely treated as a revenue generator but one that can provide immense socio-economic impetus to the economy". The draft policy, which was in public domain for consultation, focused on increasing high-speed broadband penetration, with use of modern technologies like 5G and optical fibres across the country at affordable rates.

Harsh Walia, associate partner, Khaitan & Co, in turn, said "indicated licensing reforms seem to suggest DoT looks to shed its image of a revenuemonger to a business-facilitator as charges, taxes and levies may be rationalised". Under NDCP 2018, "spectrum usage charges (SUC) may now only reflect Administrative costs, which will be a breath of fresh air for the industry whenever implemented," Walia said.

Recognition of telecom services and infrastructure as "an essential public utility," he said, would aid proliferation of such services and facilitate low-cost financing. Sinha said NDCP 2018 "can also form the main pillar of Digital India by addressing emerging opportunities for expanding not only availability of telecom services but also telecom-based services". Another key goal, he said, is "raising India's ranking in the global ICT Index to the 50th spot".

Under NDCP 2018, the government plans to ensure universal broadband connectivity at 50 Mbps to every citizen, provide 1 Gbps connectivity to all gram panchayats by 2020 and 10 Gbps by 2022 and ensure connectivity to all uncovered areas. The new telecom policy also aims to "expand the IoT ecosystem to 5 billion connected devices, secure India's communications infrastructure," the government said.

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