India may lose $13 bn due to delay in spectrum auction: Assocham

March 2nd, 2009 - 7:53 pm ICT by IANS  

New Delhi, March 2 (IANS) India may lose up to $13 billion in revenues by 2012 if the third generation (3G) spectrum is not allocated soon to telecom operators, an industry lobby said Monday.
“The telecom industry is losing a revenue of $3 billion each year on account of delay in spectrum allocation,” Associated Chambers of Commerce and Industry (Assocham) Communications Convergence Committee chairman C.S. Rao said in a study.

The government is losing a huge sum of money in terms of import duty and other taxes, as a great deal of equipment and devices needs to be imported for popular installation of Wimax technology, Rao said in the study jointly carried out by the Assocham and the Wimax Forum.

Although Wimax technology, which delivers wireless broadband for computers and mobile devices, is available in India, its use is limited since auction of spectrum is getting delayed. As a result, private telecom operators are not able to provide broadband connectivity to potential subscribers, the study said.

According to the report, the Indian market is expected to support 27.5 million Wimax users (about 19 million Wimax connections) by 2012, representing approximately 20 percent of the global Wimax user base in 2.5/2.3 GHz bands.

Assocham added that the Wimax-embedded netbooks, laptops and desktops should be imported without any additional import duty and the indigenously manufactured Wimax CPEs (customer premises equipment) should be exempted from excise duty and sales tax for at least three years.

CPE is a device installed at the customer’s premise to connect the Wimax signal with the service provider.

The Assocham further urged the government to keep the base reserve price of the broadband wireless access (BWA) spectrum low given the global economic trends.

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