Telecommunications
Revenues from licence fee from telecom service providers is expected to increase by 37.4 per cent from Rs 2,351.05 crore this year to Rs 3,231 crore in 2003-04 as per Budget estimates.
The estimated increase in licence fee indicates that there may not be any decrease in the annual revenue share for telecom operators, a long-standing industry demand.
The increase in accruals from licence fee can also be due to the government's decision to not re-imburse the annual licence fee paid by Bharat Sanchar Nigam Ltd (BSNL) of around Rs 2,000 crore.
When BSNL was corporatised, the government had offered to give back the licence fee to BSNL until the end of financial year 2002-03 to meet the cost of corporitisation.
BSNL has been demanding that the benefit should continue for some more time since the cost of corporatisation is estimated to be Rs 40,000 crore over the next 10 years.
However, 2003-04 Budget has indicated that there may not be any re-imbursements next year.
The government has also proposed to create a separate Universal Services Obligations Fund for the purpose of rural telephony. The Budget has allocated an amount of Rs 100 crore towards this fund for the year 2003-04.
At present, the USO Fund is a notional fund with the money coming from the Consolidated Fund of India. Five percent of the annual licence fee collected from the telecom service providers is set aside for the Fund.
Cellular and basic operators give between 12 per cent and 8 per cent of annual revenues to the government as licence fee depending on the area of operations.
