Associated Chambers of Commerce and Industry of India today submitted a four-pronged telecom strategy paper to the new telecom minister, Mr Ravi Shankar Prasad to reinvigorate the telecommunications sector by reducing regulatory costs, auctioning available spectrum, extending benefits of infrastructure status and providing an impetus to domestic manufacturing.

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assochamThe paper titled ‘Suggestions for new government to reinvigorate telecom industry & revive investor sentiment,’ prepared by The Associated Chambers of Commerce and Industry of India (ASSOCHAM). In its paper, ASSOCHAM has also urged the new telecom minister to immediately auction all available spectrum with socio-economic benefits valued at over Rs two lakh crore (excluding proceeds from auctions) lying idle with the government in 700, 800, 900, 1800 and 2100 MHz bands.

“Mobile communication can usher in India’s much awaited broadband revolution in a much faster, efficient and cost-effective manner as such adequate spectrum availability is of paramount significance,” the paper noted. “Thus, all available spectrum must be auctioned immediately, ideally in a big-bang auction or in a short timeframe by delivering benefits to society and revenues for government.”

There is also the need to immediately reduce regulatory costs for telecom operators and bring down adjusted gross revenue (AGR) based levies by about one per cent annually during the course of next five years over a defined glide path while simultaneously maintaining revenue neutrality of the government, suggested the ASSOCHAM paper.

“Telecom licensees pay as much as 15 per cent of their AGRs as license fee along with other related charges towards sector specific levies and various central and state taxes borne by service providers,” noted the chamber paper. “Besides, the current AGR definition is controversial and needs to be reviewed and must be referred to the Telecom Regulatory Authority of India (TRAI) for its consultation and recommendation to make it simple and unambiguous.”