DoT considering raising 3G charges

10 Sep 2008

Indian news source The Economic Times is reporting that the Department of Telecommunications (DoT) is planning to increase spectrum usage charges for telcos planning to offer 3G services; the move comes in response to the Financial Ministry demanding that the base price for the 3G auctions be raised to INR25 billion (USD557 million) from INR20.2 billion. The regulators new proposal would see spectrum usage charges increase by 1% each year; the proposal does not specify how many years this increase would continue for. Under the existing policy no usage charges apply in the first year, with 1% of total revenues to be paid in the second year. In comparison, telcos pay between 2%-6% of their total revenues as spectrum usage charges for 2G services. The Finance Ministry will now consider the proposal, although no date has been set for a response.