Vodafone India has accused the regulatory structure of Indian telecom and said that the government has not been fair with its favourable stand towards Mukesh Ambani’s Reliance Jio Infocomm. The company pointed out that Mukesh Ambani run Reliance Jio Infocomm was awarded voice facility on its ISP licence without having to pay any higher spectrum usage charges like other telcos have been subjected to.
Besides this, Vodafone India will also challenge the Department of Telecom over the delay in allotment of spectrum won for the crucial circles of Delhi, Mumbai and Kolkata, where the company gets bulk of its business.
Note that in 2013, the government allowed Reliance Jio to convert its ISP licence into a unified license for Rs 1,673 crore. This has allowed the company to offer voice services on top of data services. What’s surprising is that, the amount Reliance Jio paid in 2013 was equal to the amount other telcos paid way back in 2000.
The outburst from Vodafone is not surprising, when other operators have to shell out a uniform 5% on any new spectrum auctions, while Cabinet’s decision allowed to maintain SUC for 4G operators like Reliance Jio at just 1%. Considering that most telcos are finding it difficult to gain profit, the decision seems unjust. On top of that, Vodafone is also entangled in a tax row with the government where it was served Rs 20,000 crore tax demand, including penalties, from its 2007 acquisition of Hutchinson Whampoa’s Stake in Hutchinson Essar.