Telecom Ministry To Place IMG’s Suggestions Before Cabinet
Recommendations of IMG on easing financial stress in the telecom sector to be placed before the Cabinet next month.
The telecom ministry is likely to place before the Cabinet next month the recommendations of inter-ministerial group on easing financial stress in the sector, a senior government official said today.
The apex decision making body at the Department of Telecom last month granted an extension for the payment of spectrum bought in auctions by telecom operators to 16 years from the current 10 years.
Deferred payment option for spectrum was one of the key demands of telecom operators submitted before the IMG to provide relief to the sector reeling under debt of Rs 4.6 lakh crore. Under the present system, telecom operators are required to make partial upfront payment and rest of the payments in 10 annual instalments after a moratorium period of two years.
The commission also approved recommendation of the IMG to lower interest rate charged over penalties imposed on service providers with slight modification, a government source said.
The Telecom Commission also approved lowering of interest rate on penalties imposed on telecom operator from SBI Prime Lending Rate to MCLR plus 400 basis points.
Debt raised on SBI prime lending rate basis are charged interest of 13.7 percent. Under the new rule, if approved by the Cabinet, telecom operators will need to pay 12 percent interest on penalties and delayed payments.