KOLKATA: India’s telecom sector–once the poster child of the country’s economic progress–is in dire straits, battling brutal price competition and grappling with unsustainable levels of financial stress. It is reckoned to be looking at ways to reduce spectrum costs and defer payouts towards airwaves and associated interest charges. While telecom companies are laden with debt of about Rs 5 lakh crore, banks have put the sectoral liability at nearly Rs 8 lakh crore. In a recent note, brokerage CLSA said India’s mobile industry revenue fell for the first time in FY17 to Rs 1.88 lakh crore and will decline further to Rs 1.84 lakh crore in FY18, following the unprecedented price disruption. This, he said, “is since a telco, typically, takes at least six years to start generating cashflows, post-spectrum acquisition.”

Source: Economic Times June 16, 2017 17:59 UTC