However, in the past year, the telecom sector, which is most crucial to the economy, has remained largely ignored. 2017 was an important year for the sector, with several key announcements by both the industry and the government. India achieved a remarkable jump of 30 places in, Ease of Doing business, and the government also announced its vision to make India a USD 4 trillion dollar economy by 2022. The industry experienced an intense phase of hyper competition and debilitating financial health, announcements on consolidation followed. Today, as things stand, the sector is in dire straits, and in need of immediate cogent relief, otherwise the entire economy, including banking which has been quite vocal on the issue, as well as e-commerce, IT, Technology, logistics, services are bound to get impacted adversely.<\/p>

We commend the Finance Minister Shri Arun Jaitely on a very well thought out and meticulous Union budget, where he did mention packages for Digital India, promotion of artificial intelligence and Bharat Net, the telecom sector would have breathed a sigh of relief with some announcements related to lowering cess and taxes.<\/p>

COAI welcomes decision such as doubling of the allocation towards the Digital India Programme, to invest in research, training and skilling in robotics, artificial intelligence, digital manufacturing, big data analysis, quantum communication and internet of things, to be overseen by the Department of Science & Technology.<\/p>

This is a positive sign for the industry that the government recognises the importance of a resilient cyberspace and welcoming of new, complex technologies that can significantly improve the experience. The initiative is not just timely but suggests that the industry has the full support of the government when it comes to the next generation of technology that will be deployed in the country. The telecom industry also appreciates the move for providing an indigenous 5G test bed at IIT Chennai which will provide a suitable platform for further development of this futuristic technology.<\/p>

The Indian telecom sector has the highest FDI contribution to the economy to the tune of INR 1.3 lakh crores, and is also the second largest investor in infrastructure \u2013 around INR 9.2 lakh crores. The sector contributes as much as 6.5% to the GDP, paying as much INR 70,000 crore in just 2017 fiscal and employing as many as 40 lakh people directly and indirectly. And yet, when the telecom players needed an intervention through budget, they have been ignored by the government. It is a well recognised fact now that for every 10% penetration, the GDP gets as much as a 4% boost, and this clearly highlights the importance of the Indian telecom sector as an essential contributor to the GDP.<\/p>

Presently the financial condition of the sector is in dire need of some help. It is struggling with a cumulative debt of INR 4.6 lakh crores with revenues down to INR 2.5 lakh crores. Hyper-competition has left no space for playing with the tariffs and there is hardly any scope for cost cutting. With the formation of the Inter-Ministerial Group (IMG), the government also agreed that the sector is in bad financial shape and urgently needs policy level intervention to recover itself. But yet, it was ignored by the government in the budget presentation.<\/p>

The Indian telecom sector pays higher taxes than most telecom sectors in the world, including India\u2019s neighbours. Pakistan\u2019s telcos pay around 20% and Chinese telcos pay their government around 11%. India\u2019s telcos pay upwards of 32% including 18% GST rate and another 15% in levies such as licence fee and spectrum usage charges. For a sector as essential as the Indian telecom sector, we urge GST council to relook at the rate applicable to the sector and bring it down to lowest slab of 5% to achieve the government\u2019s policy of ensuring affordability to all segments of society.<\/p>

It is disappointing that the government has ignored COAI\u2019s submissions on some basic changes that need to be made for the sector as it experiencing extreme distress and is in dire need of help. This is much needed if the sector is expected to help achieve the Prime Minister\u2019s goal of digitally empowering every citizen and bringing the huge economic growth that connectivity brings.<\/p>

However, we are still hopeful that the government will consider the requests made by the telecom sector and will help the sector regain its balance and contribute towards the national goals.<\/p>","blog_img":"","posted_date":"2018-02-01 17:57:17","modified_date":"2018-02-01 17:57:17","featured":"0","status":"Y","seo_title":"Budget 2018: Another missed opportunity for the telecom sector ","seo_url":"budget-2018-another-missed-opportunity-for-the-telecom-sector","url":"\/\/www.iser-br.com\/tele-talk\/budget-2018-another-missed-opportunity-for-the-telecom-sector\/2870","url_seo":"budget-2018-another-missed-opportunity-for-the-telecom-sector"},img_object:["","retail_files/author_1485515109_temp.jpg"],fromNewsletter:"",newsletterDate:"",ajaxParams:{action:"get_more_blogs"},pageTrackingKey:"Blog",author_list:"Rajan S Mathews",complete_cat_name:"Blogs"});" data-jsinvoker_init="_override_history_url = "//www.iser-br.com/tele-talk/budget-2018-another-missed-opportunity-for-the-telecom-sector/2870";">