Telecom Minister Ashwini Vaishnav said on Wednesday that the 5G spectrum auction will be held in February 2022 and the government may try to get it done in January. Vaishnav said that the reforms package approved by the cabinet in the telecom sector is enough for the existing companies to survive in the market. He also said that further reforms and structural changes are under consideration. More companies should come in the area.
The Union Cabinet on Wednesday approved a major reform package for the stressed telecom sector. The package includes a moratorium of four years from payment of statutory dues, allowing spectrum sharing, changing the definition of gross adjusted revenue (AGR) and allowing 100 per cent foreign direct investment under the automatic route. Vaishnav said, “Today’s reform package is good enough to ensure competition. Certainly it is better in terms of survival of telecom companies, maintaining competitiveness in the sector and strength of the sector. Some other changes are proposed. I am sure that more companies will come from him in the area.
Telecom companies are very happy with this
The minister said that the government is fully committed to take forward reforms to strengthen the telecom sector. “We do not intend to stop.” Vaishnav said that after giving information about the package on Wednesday, he spoke with the major companies of the sector and expressed happiness about the measures that have been announced. The minister said, “All the big companies said that whatever was needed, those steps have been taken.”
Auction possible in February 2022
When asked about the auction of 5G spectrum, he said that it will happen in the last quarter of the current financial year. “It is likely to happen in February 2022…we can try in January also,” the minister said.
The government approved nine structural and process related reforms to provide relief to distressed telecom companies like Vodafone Idea. The following are these improvements.
1>> The definition of Gross Adjusted Revenue (AGR) has been rationalised. Non-telecom revenue will be further excluded from the definition of adjusted gross revenue.
2>>Bank Guarantee has been rationalised. Bank guarantee requirements have been reduced in lieu of license fee and other charges.
3>>Rationalised interest rates on late payment of license fee and spectrum usage charges. The fine was removed.
4 >> No need for bank guarantee in future spectrum auctions.
5>> The period of spectrum in future auctions has been increased from 20 to 30 years.
6>> Radiowaves will be allowed to be handed over after 10 years for the spectrum received in future.
7>>There will be no Spectrum Usage Charge (SUC) for spectrum received in future auctions.
8>>Spectrum sharing has been encouraged. Additional SUC of 0.5 per cent has been removed for spectrum sharing.
9>> To encourage investment, 100 per cent foreign direct investment has been allowed under the automatic route in the telecom sector.
1>>The time has been fixed for the auction. The spectrum auction will normally be conducted in the last quarter of every financial year.
2>>The requirement of complex import license for import of wireless equipment has been removed.
3>>The rate of e-KYC has been revised to Re 1 only.
4>> No fresh KYC will be required for transfer from pre-paid to post-paid and post-paid to prepaid.
5>> Paper Customer Acquisition Form (CAF) will be converted into digital storage of data.
6>>The Department of Telecommunications will accept the data on the basis of self-declaration on the portal.
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