Indian consumers will have to be prepared for higher tariffs if the government goes ahead with a proposal to charge for extra 2G spectrum held by telecom companies, says Bharti Airtel’s Sunil Mittal.
“If on the voice side the spectrum is going to be charged at an exorbitant price be prepared for high tariffs,” Mittal, Chairman of India’s largest telecom operator, told an Indian business news channel.
“The Indian telecom industry has gone through a massive upheaval and is no more the finest story of the country. Entire industry margins have been eroded. There are very few companies that are making any kind of return of the capital that they have deployed and holding back investments in the sector,” Mittal said NDTV Profit in an interview on the sidelines of the World Economic Forum at Davos.
RCR Wireless News has reported in the past how the Telecom Commission, the apex decision making body of The Department of Telecom, has recommended charging operators for spectrum beyond 4.4 megahertz.
“I hope that the minister, the prime minister, and the finance minister will take a considered view of balancing revenue maximisation of the government and health of the industry,” Mittal told NDTV Profit.
The government’s plan to charge for excess wireless spectrum was mentioned as one of the things that could hurt the telecom sector, according to Global ratings agency Fitch.
The top telecom industry executives have also written to Indian Prime Minister Manmohan Singh and the Telecom Minister about the concerns of the industry, which include spectrum pricing and 3G roaming deals. The executives have even met the PM and the telecom minister — the latest meeting with the latter was held on Monday, to highlight the issues the sector is facing.
The Telecom Ministry has termed the 3G roaming deals between various telecom operators as illegal. The Central Vigilance Commission, an apex body that looks into government corruption, has asked the DoT to submit all the details related to the 3G roaming deals between telecom operators.
All this comes in the wake of the 2G spectrum scam and the ongoing trial in that case, which has already had a very negative impact on the telecom sector.
