The Hindu Business Line : Telecom industry seeks duty cut on wireless data cards

New Delhi, Jan. 24 In a bid to offer cheaper wireless Internet connectivity, telecom operators have sought reduction in duty rates on wireless data cards from current 21.6 per cent to 4 per cent.

Wireless data cards enable consumers to access Internet without having to take a telephone connection. It can be used both for laptops and by desktops. Once third-generation services are introduced by mobile operators, the demand for wireless data cards is expected to increase.

At present data cards are priced around Rs 2,800. According to industry estimates, there are currently four million data card users in the country. If the duties are reduced to 4 per cent, it is estimated that the number could double as the card may become affordable to consumers in semi-urban and rural areas.

Various industry association including the Cellular Operators Association of India, Association of Unified Telecom Services Providers of India and Telecom Equipment Manufacturing Association have written to the Finance Ministry seeking a reduction in the duty structure which will enable the operators to make the data cards available at less than Rs 2,000. “Internet data card is playing a vital role in making access to Internet more user friendly by way of easy compatibility to any personal computer. Wireless connectivity is the only cost-effective and affordable way to provide Internet/broadband to the remote and rural areas were the wire line connectivity is extremely costly and difficult to achieve,” COAI said.

AUSPI has demanded that data cards be treated as computer peripherals as these cards cannot work independently without the computers.

“In the interest of increasing penetration of Internet services, it is essential that data cards, like other computer peripherals, get the benefit of excise duty exemption,” AUSPI said.

Operators said that cheaper data cards would be essential for the uptake of third-generation services in the country, as it will enable them to roll out high-speed wireless broadband services faster.

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