DoT may not give in to license fee cut demand

The government may not accede to the demand of pan-India telecom players and immediately cut the annual license fee varying between 6-10 per cent.

At a recent meeting telecom minister A Raja held with CEOs of the telcos,operators demanded a reduction in the annual license fee for companies covering the whole country.

But the DoT gave no assurance,sources in the know said.

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There is no intention to do so either,said an official.

A cut in license fee would need approval of the finance ministry and mean revenue outgo to the exchequer,the official said.

However,an industry official who attented the meeting said DoT was quite favorable to cut two per cent in license fee for those operators who have covered 90 per cent of the country and there was some procedural delay in doing so.

DoT is waiting for the TRAI recommendations on a uniform license fee. Internally,DoT has decided that it should be 8.5 per cent for all service areas and all types of services.

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DoT’s decision on uniform license fee would,however,cannot be termed as license fee cut as it is a realignment of several rates into one,said the DoT official,adding it would check loss of revenue arising out of arbitrage opportunities made by telcos.

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