Telecom operators on Wednesday said that while they are investing a lot on developing future technologies for better services, the sector also needs some relief from the government in terms of taxes, regulatory norms and spectrum cost.

“Taxation on the industry is very high, at29-32 per cent. Spectrum costs is one of the highest with tariff being one of the lowest. All of this need to change to realise the dream and vision of Digital India,” Gopal Vittal, CEO and Managing Director, India and South Asia, Bharti Airtel, said at India Mobile Congress (IMC) 2017 here.

Speaking on the ‘CEO Conclave’ at IMC 2017, Vittal said Bharti Airtel’s investments in the past two years have been more than that of the past 20 years put together.

He said the debt of the industry at about ₹4.50 lakh crore and the return on capital at about 1 per cent are all problems that need to be acknowledged.

Vittal said such issues need to change if the ‘Digital India’ dream is to be achieved. He also highlighted issues concerning laying of fibre and the policy of mergers and acquisitions.

He explained that telecom companies find it a “painful process” to find access to government buildings when they want to lay down fibre. “The pace at which the mergers and acquisitions policy is carried out is a challenge. And all of this needs to be streamlined.”

Similarly, Idea Cellular MD Himanshu Kapania said the recent market developments have drastically altered industry dynamics, resulting in the sector passing through a phase of severe “financial and mental stress”.

‘The elephant in the room’

Terming the regulatory and financial issues being faced by the sector as the “elephant in the room that no one is talking about”, Kapania flagged the recent cut in interconnect usage charge (IUC), firm spectrum prices, and high levies such as licence fee and GST as big constraints.

He said, therefore, there is an urgent requirement of support from the Telecom Ministry for bringing down the costs of licence fee, IUC and reducing GST to 5 per cent.

“The future cannot be on a good path if such things continue. The private sector is working on a breakneck speed and we need the support of the government,” he said. Kapania also warned that the fault lines are already becoming visible as the industry is witnessing a “degrowth”.

For the future

Vodafone India MD and CEO, Sunil Sood said the future success of India on the world stage depends highly on telecommunications as it contributes 6 per cent to India’s GDP.

Convergence of technologies such as machine to machine (M2M) and Internet of things (IoT) are dependent on telecom. Therefore, for India to succeed, it is essential that the telecom sector is in a good shape.

Mathew Oommen, President, Network, Global Strategy and Service Development, Reliance Jio, said the industry needs to work towards better technology for the growing internet environment.

The industry needs to bring open-source and other technologies such as IoT and artificial intelligence at the most affordable price, he said.

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