ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Rajkumar UpadhyaySubscribe to Rajkumar Upadhyay

Uniform Licence Fee in Telecom: Way Forward

Telecom service providers are required to obtain a licence before starting any kind of service in India. They pay a certain percentage of their revenue as a licence fee to the government on a quarterly basis and the percentage of revenue to be shared depends on the type of service offered and the area of operation. This article argues that such a differential system of licensing is flawed and leads to cross subsidisation and possible arbitrage. It estimates the impact on individual operators and the government's revenue, in case the government implements a uniform licence fee for all services in each area and also argues for a reduction in the licence fee in line with revenue growth.
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