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Wireless Operators to pay more for licence renewal

May 4th, 2009

Cellular services providers are likely to cough up out a sizeable amount to renew their licences to continue operating which may be due to expire in the coming years, as a government panel is on its way to implement all spectrum related issues.

The government panel has recommended slapping a fee on telecom companies, a sum equivalent to the market value of the spectrum they hold at the time of renewal. Notably, most of the telecom operators had received their licences in the early 1990s for a 20-year period which is close to expire over the next couple of years.

As of now, these companies can avail a pan-India licence for Rs 1,651 crore, a rate determined in 2001. India with 22 circles, has a different entry fee for each circle and the total sums up to this amount. The panel has proposed three possible methods to determine the fee which operators will have to pay to renew their licences. It has also recommended auctioning airwaves by the government in case the company refuses to pay the renewal fee.

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