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Telecom industry flags floor prices, AGR as issues in meet with TRAI: Report

Floor price for tariffs and redefining adjusted gross revenue (AGR) were the key issues flagged by telecom industry at a meeting with TRAI chairperson Ram Sewak Sharma on November 27, the Economic Times reported. The meeting was held to identify key issues that would be taken up next year. However, it appears that TRAI is unlikely to intervene on tariff issues and floor prices as Bharti Airtel, Vodafone Idea and Reliance Jio have announced increases in call and data charges, according to a Firstpost report. Vodafone Idea, Bharti Airtel, Reliance Jio, BSNL and MTNL were present at the meeting.

Why this matters: The Indian telecom sector is currently reeling from a massive financial stress. As per the Supreme Court’s order on October 24, Airtel and Vodaone Idea have to pay statutory dues of worth Rs 92,640 crores to the central government, which includes disputed demand, interest and penalty. All of this has pushed the telecom companies to demand TRAI’s intervention to address the sector’s woes. However, Sharma said that the November 27 meeting was a general discussion on the issues to identify priority areas for next year, the ET report said.

Which other issues were discussed? Other issues included discussions around infrastructure sharing and the use of blockchain for services such as mobile number portability (MNP) and Know Your Customer (KYC). Industry officials also want TRAI to release a consultation paper on the definition of AGR.

Cabinet comes to telecom sector’s aid

The Union Cabinet on November 20 approved the proposals to mitigate financial stress being faced by the telecom service sector. The Department of Telecommunication (DoT) will provide an option to telecom companies to defer payment of the spectrum auction installments that are due for 2020-2021 and 2021-2022, either for one or both years. The cabinet’s decision will offer an estimated Rs 42,000 crore overall relief to Airtel, Vodafone-Idea, and Reliance Jio for the next two years.

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