In a move that could launch the revival of India's long-suffering telecom sector, the committee of secretaries (CoS) is mulling setting a minimum price for mobile calls and data, sources told CNBC-TV18.
Sources have confirmed the committee has sought recommendations from Department of Telecom (DoT) on setting a minimum charge for all tariffs for telecom players and also assessing the impact it will have on telecom operators.
This move will be beneficial for incumbents like Vodafone Idea and Bharti Airtel who reported a combined loss of RS 74,000 crore for its second quarter ended September 30, 2019 results after the Supreme Court asked telecom companies to pay Rs 92,000 crore to the government as Adjusted Gross Revenue (AGR).
"The committee has asked DoT to suggest a floor price, that has the least on consumers and at the same time ensures that voice and data volume continues to rise at the current pace," said sources.
The department will soon begin consultations for the floor price on voice and tariffs and then finalise the recommendations which will be sent to the committee of secretaries.
Sources add the DoT, in its consultation paper, will seek to asses multiples points, including the minimum charge that should be set, the rationale and the financial benefit it will have on telecom operators.
The committee has been looking at all measures to revive the stress in the telecom sector, from license fee relief to relief in a moratorium on spectrum payment. After the dot asked Telecom players, to pay the AGR dues in three months after the SC verdict, it's evident that no relief is expected on the AGR payment front.
Hence, telecom operators are relying on relief from the committee to be able to survive the stress on the balance sheet.
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