Do you think that the government needs to assist the telecom sector for facilitation of 5G roll-out? Comment.

Published: July 3, 2019

India has come a long way since the stringent requirements of licensing. Now anyone who wants to enter telecom services can bag a licence easily. However, the only constraint is the availability of spectrum. This has enumerated the need to reflect on the reserve prices for the auction of 5G mobile services by TRAI.

  • As per the guidelines issued by TRAI, the reserve prices are very high and also are a clear reflection of an extractive mindset.
  • It completely ignores the present circumstances and the sector runs the risk of losing money for the government. This can also compromise the ability of India to adopt 5G services.
  • The Indian telecom sector is already facing heavy debt burden primarily because of heavy amounts which have been paid for spectrum and other kinds of regulatory changes.
  • The sector also faces huge competition in the form of technological disruptions via various apps which have put pressure on traditional forms of revenue streams.

The sector thus needs governmental support and be given enough room to deal with all kinds of circumstances. Auctions of spectrums have come with their own advantages in terms of efficiency and an increase in revenue for the government. However, there is a risk as the outcomes are design-dependent. High reserve prices can result in unsold spectrum and delay in services. Thus, the government needs to ensure transparent allocation and revenue expectations for the government.
 

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