Jt Mobiles Seeks More Time For Tranche Payment; Files Petition

JT Mobiles has filed a petition with the Telecom Regulatory Authority of India (TRAI) seeking deferment of payment of the second tranche of licence fees (third quarter) for the Karnataka circle, saying that the recent tangle over fixed-to-cellular call tariff has disrupted its plans. The last date for payment was May 15. The regulator will hear the petition on June 24.

The company says telecom secretary Anil Vinayak Gokak has given the assurance that its bank guarantee would not be encashed immediately. However, a final decision will be taken after Gokak returns from his US trip in the middle of this month.

 

In the petition, the company has said that the January 29 order of the department of telecommunications (DoT) raising the fixed-to-cellular tariff to a maximum of Rs 28 for a three-minute call, which was quashed by TRAI on April 25, has thrown its plans into a tizzy.

The company says financial institutions were willing to fund its projects. But, with the hike in tariff, they grew cold feet and pulled out saying that the killer tariff would render the projects unviable. Now, negotiations would have to start all over again.

Another reason cited by the company is that DoT has yet to provide interconnectivity to its mobile switching centres. Interconnection between the network of DoT and that of the cellular services provider is essential for access to each others subscribers.

Besides Karnataka, the company is also one of the licensees to provide cellular services in Andhra Pradesh. The last date of licence fee payment (second tranche, third quarter) for the Andhra circle is June 12.

The entire equity of JT Mobiles which has grown to Rs 350 crore from the initial Rs 250 crore is held by five partners: Telia AB of Sweden (26 per cent), Jasmine International (13 per cent), Telecom Authority of Thailand (10 per cent), Sanmar (20 per cent) and United Telecom (31 per cent).

The company had earlier appointed a consortium consisting of Industrial Development Bank of India (IDBI), ABN Amro and SBI Capital Markets to raise funds worth $200 million.

However, the ties with IDBI were strained with the financial institution seeking clarifications in view of a legal tussle between the Parasrampurias and non-resident Indian businessman R K Kataria over the equity holding.

JT Mobiles has also been in talks with ANZ Grindlays, Deutsche Bank, ABN Amro and a consortium of Japanese banks. But nothing has worked out so far.

In Karnataka, the company is planning to share the cellular backbone network with Spice Telecom, the other licensee, to cut costs.