TRAI gives Rs 6,440 cr bonanza on lower annual licence fee | india | Hindustan Times
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TRAI gives Rs 6,440 cr bonanza on lower annual licence fee

india Updated: May 17, 2010 20:17 IST

Telecom regulator TRAI on Monday said mobile operators would be paying only Rs 8,125 crore towards excess spectrum charges, as they would be saving over Rs 6,440 crore on account of lower annual licence fees.

While giving its recommendations on spectrum management and other issues, TRAI had also lowered the annual licence fee to six per cent across the nation, which would result in savings of Rs 6,442 crore for all the players.

In the case of Bharti Airtel, the lower licence fee would result in savings of Rs 1,996 crore, while for Vodafone, it would be Rs 1,387 crore.

TRAI had proposed that the licence fee paid by operators should be reduced in the next four years to an uniform 6 per cent of adjusted gross revenue from the current 6-10 per cent.

At present, telcos are charged a licence fee of 10 per cent in the metros and A circles, 8 per cent in B circles and 6 per cent in C circles.

For radiowaves beyond the contracted 6.2 Mhz in their possession, the Telecom Regulatory Authority of India (TRAI) last week recommended that operators pay a one-time fee based on prices of 3G spectrum, the auction for which is currently on.

Bharti, Vodafone Essar, MTNL and BSNL hold over 6.2 Mhz of spectrum in many of the circles. Bharti and Vodafone hold more than 10 MHz in many circles, including Mumbai and New Delhi.

Telecom stocks were battered on stock markets following the TRAI proposals in anticipation of operators' balance sheets being hit by huge payouts.

As per TRAI's proposals, for spectrum between 6.2 Mhz and 8 Mhz, operators have to pay one-time fee discovered by the 3G auction. For spectrum between 8 Mhz and 10 Mhz, the fee would be 1.3 times the 3G price.

All TRAI proposals need to be approved by the Department of Telecom to be made law.