Although Nepal Telecom has seen some progress in terms of users, it has not been able to keep pace with the pace taken by Ncell in the last few years. As of mid-June last year, Nepal Telecom had 3.4 million more users than Ncell.
According to current statistics, the gap has dropped to 1.4 million. If Ncell moves forward at the same pace, it is certain that Nepal Telecom will lag behind Ncell in terms of users in the next few years.
The license of the then Spice Nepal Pvt. Ltd. (now Ncell) has been a factor directly or indirectly behind Nepal Telecom coming to this stage. Which has always been a burden for telecom?
The state-owned telecom company had received the license for mobile service in April 2056. No decision has been taken on the fee to be charged and the renewal fee for issuing a mobile service permit to the telco.
The license was given to the telco on the condition that the future service provider would be willing to pay the amount through bidding. As per the agreement between NEA and Nepal Telecom, the license was given on the condition that the license fee, royalty, and renewal fee accepted by the company obtaining the license for the mobile service from the global tender would also apply to the telecom.
But this condition is not covered by any law. The study report of the sub-committee under the Public Accounts Committee of the parliament is meant to conspire to bring down the telco by making the issue which is not in the law a condition.
According to a study conducted by a parliamentary committee in 2068 BS, various conspiracies have been hatched to bring down the telecom. When the government increased the auction for mobile service permits, the then Spice Nepal Pvt. Ltd. (now Ncell) was the highest bidder for the renewal.
The then Spice Nepal got the license for mobile service in August 2061 on the basis of pledging the highest amount. The company had promised to pay Rs 210 million for the license and Rs 20 billion for the first renewal in 10 years.
There is a legal provision that the license for mobile service will be for 10 years initially and it should be renewed every 5-5 years. Accordingly, the telco has already paid the first renewal fee in 2066 BS.
The amount of the second renewal fee has not been decided yet. Telecom's mobile service license was renewed for the second time in April 2071 BS. NEA has maintained the second renewal fee of Rs 20 billion and given the facility to pay the telco in five installments.
Based on that, the telco has so far paid the second installment of the second renewal. The report states that ignoring the renewal fee, which seemed unnatural at the time, was a major problem in Nepal's telecommunications sector.
"It has had a direct impact on Nepal Telecom," the report said, adding that it had obtained the license on the same terms. The issue of whether the mobile service provider can pay Rs 20 billion or not does not seem to be taken into consideration while renewing the license.
The report of the sub-committee has concluded that this situation was created due to a lack of understanding at that time. Former NEA chairman Suresh Kumar Pudasaini says, "Ncell's license was issued from the plan to make Nepal Telecom a dharasai." If this were not the case, then there would have been sufficient legal grounds for Ncell to pay the same amount as it promised and for other service providers. But, I didn't go that far. '
Ncell at that time needed a license for mobile services under any circumstances. So he pledged more than expected. Pudasaini says, 'He was the only one to bear the responsibility. But, that did not happen. The new provision could have been arranged for the second time based on the price promised by Ncell. But that did not happen. Now it has been applied for life. Which is constantly pushing towards the collapse of telecom.
There is no study on whether the 20 billion burdens raised by Ncell can be borne by the telco or not. As a government company, many things could have been different if a study had been done at that time on whether it could compete with a private company within the law to be followed.
A telecommunications expert says, 'But that didn't happen. Instead, NEA advised the Ministry of Communications and Information Technology to make a law to maintain the renewal fee at four percent of the service provider's total income.
NEA had sent a letter to the ministry in July 2073 BS recommending for the second time at the rate of 4 percent of the annual income after the first renewal fee of Rs 20 billion. However, the government has not yet made a decision on the issue. Had such an arrangement been implemented, there would have been a possibility of creating a somewhat comfortable environment for telecom.
Translated from the article written by Rajan Koirala
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