Telecom tariff set to drop

The telecom tariffs are set to drop further as government has decided to cut the annual licence fee for access servicesto six percent of adjusted gross revenue(AGR). A final decision is yet to be taken on the matter but it is likely that soon Telecom commission and Finance Ministry and Planning Commission will discuss the matter this month and a final decision will be made. The draft note proposing to reduce the licence fee for access services and also for Internet protocl virtual private network(IP-VPN) services has been approved by the DoT. Currently operators are bound to pay licence fee at the rate of 10% (category A circle), 8% (category B circle) and 6% (category C circle) of AGR.
Private operators like Bharti and others have always asked govt. to reduce licence fee and spectrum charges. Sunil Bharti Mittal, of BTVL have already promised that if government reduces the licence fees then the whole profit will be passed to the customers. The meeting of Telecom commission held recently has observed that mobile services had been growing at a rate of 64 percent per year. And this rate will facilitate the govt. to reduce the revenue sharing licence fee by 50% annualy without affecting the revenue of government.
The draft note also highlights that COAI and AUSPI has pointed out that in India the levies and duties on Indian Telecom Sector were one of the highest in the world at more than 25 percent of revenue.