IMG to meet on Aug 11 to finalise report on telecom sector financial woes

The inter-ministerial group on telecom issues is likely to meet on August 11 to discuss measures to ease the financial stress in the sector, officials said today.

The meeting was previously scheduled for August 14 and 16 but it is now likely to be held on August 11, two telecom department officials familiar with the matter said.

"This will be an internal meeting of IMG members to discuss the proposals," one of the officials said.

The IMG is considering giving telecom companies more time to pay for the spectrum they bought, as part of efforts to bring relief to the sector that is reeling under Rs 4.6 lakh crore debt burden.

One of the proposals being deliberated is easing the period of deferred spectrum payment to improve the cash flow of telecom companies.

Currently, a portion of spectrum auction amount is taken as upfront payment by Department of Telecom (DoT) and the balance after a two-year moratorium is paid out every year in 10 instalments.

Other proposals being discussed include convergence between DoT guidelines and RBI guidelines on the issue of allowing spectrum as a collateral.

The inter-ministerial group, in June, had held extensive consultation with all telecom players and large banks on the industry's financial difficulties.

Large operators have been flagging pressure on profitability and revenue, and have blamed competition intensified by the entry of newcomer Reliance Jio for their woes.