The Union Cabinet has decided to bring about comprehensive reforms in the telecom, auto, and Drone sectors. The Cabinet also approved the Rs 64,000 crore ‘Atmanirbhar Arogya Bharat’ project announced in the last budget. It has announced a complete overhaul of the telecom sector, allowing 100 percent foreign direct investment. The Rs 26,058 crore incentive scheme will be implemented over a period of five years with a view to attracting more investment, new technology, and job opportunities in the automotive sector.
4,75,000 crores of investments expected over the next five years, said Union minister Anurag Thakur. Also, the center stated that the performance of the telecom sector in combatting the Covid-19 crisis resulted in a drastic change and surge in Internet data consumption.
- Permission for 100% foreign direct investment. So far it has been 49 percent.
- Telecom companies have been exempted from the AGR (Adjusted Gross Revenue) based on the statutory levy.
- The requirement for a large bank guarantee for license fees and levies will be reduced by as much as 80 percent. No bank guarantee is needed for different license sectors in the country.
- Interest rates reduced, fines waived. Late fees on License fees and spectrum usage rates etc have been reduced from 4% to 2%. Interest on fines waived.
- Auctions no longer require a bank guarantee, and the term of the auction and duration of the spectrum will be 30 years instead of 20.
Telecom Minister Ashwini Vaishnav said that the measures approved also include a four-year moratorium on unpaid dues, AGR, and spectrum dues. People will have to pay interest on the moratorium period, which will be SBI’s MCLR plus 2 percent. The digitization of KYC is another reform. Shifting from Prepaid to Post-paid and vice-versa will not require fresh Know Your Customers and no form-paper work is required now. Self-KYC (App-based) permitted and E-KYC rate revised to only One Rupee.