Telecom inter-ministerial group likely to finalise report by Aug 27

New Delhi, Aug 22 (IANS) The inter-ministerial group (IMG) set up to examine the issues affecting the health of the Indian telecom sector is expected to submit its report on recommendations by August 27, sources said here on Tuesday.

According to sources, Communications Minister Manoj Sinha told Parliament on August 7 that the report will be out in 20 days, so it is expected to be ready by August 27.

The task of the inter-ministerial group is to examine systemic issues affecting viability and repayment capacity of the telecom sector and furnish recommendations for resolution of stressed assets.

The group, comprising officials from the finance and telecom ministries, was set up after top banks expressed concern about financial stress in the industry.

The panel met for almost two hours on Tuesday. According to sources, drafting of the report has started. Once it is completed, it will be presented in front of the Telecom Commission when it meets next on September 1.

Sources confirmed that there is consensus among the IMG group members broadly on all issues. "There will be relief for the telecom operators," they added.

The two broad decisions on which there is consensus are deferred payment for spectrum fees and shifting to prime lending rate (PLR) to marginal cost of funds-based lending rate (MCLR) regime for interest payments.

At present, after acquiring spectrum through auctions, companies pay certain amount to the government upfront and the rest is paid in 10 instalments after a two-year moratorium. The operators have requested to extend the period. It is expected that the period will be extended to 16 years.

The next meeting of the inter-ministerial group has not yet been finalised.