A separate exit policy to be framed by DoT for telecom sector

Follow Us

The Department of Telecommunication (DoT) is currently working on framing an exit policy for the telecom sector in the country. The new policy will allow the companies to exit the sector without losing out on the value of assets that they have accumulated over a period of time.

DoT HelplineCurrently, there are a slew of regulatory approvals and guidelines which come into play regarding the transfer of assets of a company when it is looking to exit the concerned sector. So the DoT wants to setup a separate framework for the telecom sector to overcome all these hurdles. This move has come into place because the Government wants the telecom sector to be seen as an investor-friendly one which allows for ease of entry and exit from the country.




The move comes after the Loop Mobile service provider of Mumbai wanted to exit and Bharti Airtel wanted to acquire its business but the deal couldn't go through due to the current regulations. The business was being sold for Rs 700 crore using a slump sale model (where a lump sum is paid without evaluation of assets and liabilities) but the deal couldn't be approved because slump sale is not a part of the country's telecom policy.

TRAI has told the company to offer its customers MNP instead of shifting them to Airtel right away.

Here’s what an internal DoT memo reads as, “as of now, only way available to the Licensee to exit the sector is by way of surrendering of Licence and spectrum. Today, transfer of business, slump sale is also a common market mechanism. Spectrum sharing and trading cannot be an answer to all exit policies. However, such valuations are beyond Licensor (DoT) jurisdiction and can be a source of creative accounting. Even with spectrum trading, the authorisations are not transferred.”

The internal note clearly mentions that it is difficult to exit the telecom sector and as a result many investors may hold back in future from coming to India. But if the new policy comes into effect, things may change for the betterment of the telecom sector.

Via: Live Mint

Recent Comments

Shivraj Roy :

i agree with you ,i just got my porting finished from jio to vi ,and its so much better from…

BSNL and Vodafone Idea Continue to Lose Wireless Subscribers: TRAI

. :

Moved to Vi enjoying great network speeds, as Airtel and jio is congested in may area.. Those who need congestion…

BSNL and Vodafone Idea Continue to Lose Wireless Subscribers: TRAI

Krish :

No one will be interested in Vi unless they get it an extremely discounted rate! Even then, the new promoter…

Vi Talks About Fundraising Yet Again, Will the Magic Happen…

Faraz :

Not the first time.. India has been trying since a long time with Pragati OS, Bhar OS and what not..…

Govt Planning to Develop India's Own Smartphone Brand

Rupesh :

I feel they should have added 5G BTS at same pace as they are adding store. But instead they will…

Bharti Airtel Launches 18 New Stores in Hyderabad; Expands in…

Load More
Subscribe
Notify of
2 Comments
newest
oldest most voted
Inline Feedbacks
View all comments