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The Government is expecting to get nearly Rs 30,000 crore from telecom services in 2011-12, indicating the possibility of another round of spectrum auction. The exchequer received Rs 1.2 lakh crore in 2010-11 from the sale of 3G and broadband spectrum, compared to Budget estimates of Rs 49,799 crore.
“The Group of Minister will decide on the timing and what to auction, but we are expecting around Rs 30,000 crore next year,” said Ms Sushma Nath, Finance Secretary, at a press conference after the presentation of the Budget by the Finance Minister. The Rs 30,000 crore includes revenues from licence fee and annual charges collected from the operators.
While the Government is looking to get almost one-fourth of its non-tax revenues from the telecom sector, the Budget did not offer any sops to the sector. Mobile-handset makers have got some relief as the exemption from basic customs duty available to parts, components and accessories for manufacture of mobile handsets has been extended till March 31, 2012. “The extension of special additional duty on components for mobile phones for another year is a welcome step. However, the increase in central excise duty is detrimental as it will make mobile phones more expensive and provide impetus to the grey/un-branded market,” said Mr D. Shivakumar, Vice-President and Managing Director, Nokia India.
“None of our demands have been met. Telecom continues to be seen as a revenue earner for the Government without any relief to the operators,” said Mr Rajan Mathews, Director General, Cellular Operators association of India.
On the expenditure side, Rs 1,890 crore has been earmarked for Universal Services Obligation fund for 2011-12 compared to Rs 3,100 crore in 2010-11. More funds may be allocated later, as the Government is planning to roll out an optic-fibre cable network to reach broadband services to over two lakh villages. Rs 900 crore have been set aside for laying the cable network for defence forces, which is crucial for future spectrum vacation.
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