Cellular Operators’ Association of India (COAI) has written to the Department of Telecommunications (DoT) stating that there is an urgent need to set floor price for tariffs in the Indian telecommunications sector. Further, COAI has urged the government to grant a three-year moratorium followed by 15 year payment schedule for the adjusted gross revenue (AGR) dues.
The industry association also mentioned that the banks are currently reluctant to take any risk as far as the Indian telecommunications sector is concerned and, therefore, are not in favour of either issuing new bank guarantees or renewing the existing ones.
Further, COAI’s letter has reportedly also suggested that the practice of invoking bank guarantees to secure license fee payments should be abolished and even if it is required, should be reduced to one quarter of license fee.
Among some of the key recommendations, the industry body has suggested the DoT to set-off of goods and services tax (GST) credits lying with the government against AGR dues. It has also sought an immediate cut in licence fee levy from 8 per cent to 3 per cent and reduction in spectrum usage charges (SUC).