The government will defer spectrum payments due from telecommunications companies for two years to help an industry ravaged by a year-long price war, mounting debt and a court decision last month demanding 13 billion dollars in overdue fees.
The moratorium will be for two years beginning April 2020, the Finance Minister, Mrs. Nirmala Sitharaman, told reporters after a Cabinet meeting in New Delhi on Wednesday. Interest as stipulated in airwaves auctions will continue to be paid, she said.
The proposal was recommended by a panel of senior bureaucrats under the Prime Minister to help wireless carriers the government estimates owe more than 20 billion dollars in license fees and spectrum charges. The relief will be worth as much as Rs. 45,000 crore and the panel will continue to discuss other measures to help the industry, an official told reporters.
Mr. Narendra Modi intends to help preserve the survivors in a telecommunications industry that has shrunk from a dozen wireless operators a couple of years back to just three private-sector firms. Carriers that had flocked to the country's fast-growing market were led to merge or quit the business after Reliance Jio Infocomm Ltd., led by Mr. Mukesh Ambani, spurred an intense price war at its launch in 2016.