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Telecom ministry to send IMG suggestions on financial woes to Cabinet

IMG to provide relief to the sector reeling under debt of Rs 4.6 lakh crore

Press Trust of India  |  New Delhi 

The is likely to place before the Cabinet next month the recommendations of (IMG) on easing financial stress in the sector, a senior government official said today.

"will send to Cabinet for its approval in about 4 weeks," the official, who did not wish

Telecom, Towers, Mobile, Trai, IUC
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to be named, told PTI.

The apex decision-making body at the Department of Telecom last month approved an extension of time-period for the payment of spectrum bought in auctions by telcos to 16 years from the current 10 years.

Deferred payment option for spectrum was one of the key demands of submitted before the IMG to provide relief to the sector reeling under debt of Rs 4.6 lakh crore.

Under the present system, 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 the 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 per cent. Under the new rule, if approved by the Cabinet, will need to pay 12 per cent interest on penalties and delayed payments.

First Published: Tue, October 17 2017. 18:55 IST