The High-Level Committee on Financing Infrastructure, headed by Mr Rakesh Mohan, has estimated that the telecom sector would require an investment of Rs 6.5 lakh crore during the 12th Plan.

Of this, Rs 5 lakh crore would come from private operators and the rest from State-run telecom companies.

The panel has suggested a discussion on fiscal measures needed to lower the burden on the industry.

The panel's presentation lists several suggestions including ending multiple tax on telecom operators, who currently pay 30 per cent of their revenue as levies and taxes.

Easy access to funding

The other measures highlighted are uniform GST at the State and central levels, grid power connectivity on priority, extended tax holiday under section 80IA, giving right of way in States to infrastructure providers and giving telecom sector a key infrastructure status. The panel has suggested making funds available to telecom companies on easy terms and setting up a dedicated entity for telecom sector funding.

The committee was set up by the Government in November 2010 to find out the investment requirements in ten major physical infrastructure sectors.

India aims to double its investment in infrastructure to about $1 trillion during the 12th Plan, from an estimated $500 million in the current Plan.

Jump in subscriber base

For the telecom sector, the panel has estimated that the total subscriber base will increase to 1,200 million by 2017, from 846 million at present.

Of this, 300 million will be on 3G or 4G network and 175 million would be broadband subscribers. To meet this demand, operators will have to invest Rs 1.35 lakh crore on 2G networks and Rs 1.5 lakh crore on 3G/4G equipment, Rs 40,000 crore on transmission equipment (routers, microwave and so on) and about Rs 1 lakh crore on passive infrastructure (tower, battery, power).

In addition, the panel expects Rs 1 lakh crore expenditure on buying spectrum through auction and Rs 50,000 crore on consumer premise equipment (modem).

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