COAI says telecom industry financially stressed; seeks govt support

The Cellular Operators' Association of India (COAI), in its outlook for 2021, said 5G launch is expected in the later part of the year.

New Delhi: The telecom industry, which facilitated wide-spread digital adoption during the pandemic, continues to be financially stressed and seeks government support on issues like liquidity, rationalisation of levies, AGR and spectrum pricing, according to COAI.

The Cellular Operators’ Association of India (COAI), in its outlook for 2021, said 5G launch is expected in the later part of the year.

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The technology is poised to open up a plethora of possibilities in the context of business models, better education, healthcare, smart cities, smart manufacturing, and intelligent logistics, S P Kochhar, Director General of COAI said in a statement.

“However, industry continues to be financially stressed and we seek the support of the government in enabling the industry to truly play its role as an enabler of horizontal growth and a boost to the nation’s economy,” Kochhar said.

COAI said challenges relate these relate to liquidity, rationalisation of the regulatory levies, Adjusted Gross Revenue (AGR) issues, spectrum pricing, Right of Way (RoW) rules, and cell tower radiation.

“COAI has been pressing the government and TRAI (Telecom Regulatory Authority of India) on these,” Kochhar added.

Like any other sector, the telecom industry too was impacted by the pandemic with a sharp fall in the number of subscribers in March and April.

However, as business and individuals adopted digital ways, telecom industry emerged as a “saviour”.

Many telecom players have benefitted from a surge in the traffic of data and voice, due to which the telecom sector is performing well as compared to other infrastructure sub-sectors, he said.

In the first quarter of this fiscal year through June, customer spending on voice and data services increased 16.6 per cent year-on-year, amounting to Rs 35,642 crore (USD 4.80 billion).

The growth of data services was primarily triggered by the use of over-the-top or OTT platforms for voice communications, chat, online meetings, webinars, entertainment, among others.

“The number of internet subscribers in the country is expected to double by 2021 to 829 million and overall IP traffic (Internet Protocol traffic or web traffic) is expected to grow four-fold at a CAGR of 30 per cent by 2021,” it added.