For the telecom sector, which had been seeking infrastructure status, reduction in taxes and clarification on service tax issues, the Budget has been a disappointing one.
“There has not been a single incentive for the telecom sector. For that matter there has not been any incentive for the sector for the last three years,” said Cellular Operators’ Association of India (COAI) Director-General Rajan S Mathews.
“The industry needed a lot of support from the government as now broadband is happening, 3G has been rolled out in many circles and a number of operators are looking at rolling 4G services,” Mathews added.
Apart from income taxes, other taxes and levies – including Octroi, excise and State taxes, spectrum levies and licence fees among others are as high as 30 per cent.
“The high expectation of assistance to telecom tower companies that have been granted the status of harmonised infrastructure sector has gone in vain,” said Syed Safawi, Chief Executive Officer at independent tower firm Viom Networks.
However, a positive note was added by Safawi. “The financial restructuring scheme for Discoms will ensure availability of reliable grid power that will enable the telecom sector to reduce its dependency on diesel and benefit both the environment and drive efficiency for the sector,’’ he said.
Mohammad Chowdhury, Leader-Telecom at PwC India, said the hike in import duty is negative for the sector, though the expectations from the industry were “very optimistic”.
Hemant Joshi, Partner at Deloitte Haskins and Sells said, “generally, the Budget has been non-event for the telecom industry. The Finance Minister has lost the chance of incentivising the highly leveraged industry which has potential to give fillip to GDP growth.’’
rajesh.kurup@thehindu.co.in