Telecom sector revenue decline to impact government's 2017-18 collections

The declining sales revenue of the telecom players will have an adverse impact on government revenue collection in the form of spectrum usage charges and licence fee in the current financial year, parliament was informed on Wednesday.

"Telecom Industry including state-owned telecom PSUs and major banks have apprised the government about the financial stress in the telecom industry. The telecom sector witnessed a sharp decline in revenues in second half of financial year 2016-17," Communications Minister Manoj Sinha informed the Lok Sabha in a written reply.

"The revenue decline in the second half of financial year 2016-17 was mainly concentrated in the last quarter of the year. The declining tariff in the sector led to an adverse impact on revenue," he added.

Sinha also said: "If this trend continues, the License Fee and the Spectrum Usage Charges are likely to be impacted adversely during the current financial year."

Sinha said in the financial year 2016-17, at the end of the April-June quarter, the government collected licence fee of Rs 3,975.66 crore, Rs 3,584.04 in the July-September quarter, Rs 3,452.13 crore in October-December and Rs 2,663.29 crore in the January-March quarter.

An Inter-Ministerial Group has been set up by the government with representatives from the Department of Telecommunications, Department of Financial Services, Department of Economic Affairs and Department of Revenue to examine systemic issues affecting viability and repayment capacity in the telecom sector and make recommendations for resolution of stressed assets, he said.

--IANS

ag/bg