Manage telecom sector in new style: Minister Gurung

By A Staff Reporter

Kathmandu, Mar. 13: Minister for Communications and Information Technology Prithvi Subba Gurung has said that the telecommunications sector needs to be managed efficiently to overcome the growing challenges. 

He made this remark while addressing a programme on "Revitalising the Telecom Industry" organised by the Society of Economic Journalists-Nepal (SEJON) in Kathmandu on Wednesday.

Minister Gurung suggested that telecommunications operators should work with a new style. 

Pointing out that a new style is needed in telecom companies to solve the problem of declining income, he said that the government is serious about reforming the law.

Admitting that the regulatory role is not sufficient, he said that the draft of the new Telecommunication Act is in the process of being finalised. 

He said that work is being done to draft a new law to make it relevant to the times by including issues such as license fees and new technology. 

He directed the regulatory body, the Nepal Telecommunications Authority, to work on regulation without being biased. 

He urged the Authority to play the role of a facilitator and become a strong regulatory body.

Stating that it is trying to change the burden of the expensive renewal fee of Rs. 20 billion, he said that now the government is trying to move the telecommunications sector forward with innovation. 

Minister Gurung said that he would take responsibility to increase the revenue from the telecommunications sector as it continues to decline.

Secretary, Ministry of Communications and Information Technology Radhika Aryal said that the deteriorating financial condition of telecom companies has raised the concern. 

She said that it is time for all the regulatory, implementation and planning agencies to come together and find a solution. 

She said that the reduction in the number of telecommunications service providers from six to two, which were once in existence, has made the sector more vulnerable.

Presenting a working paper on the occasion, telecommunications expert Manohar Kumar Bhattarai said that the mobile industry is a fundamental medium for promoting the digital economy. 

He presented data that the contribution of the telecom sector has fallen from 3.6 per cent to 1.8 per cent in the recent past.

He presented the fact that although 90 per cent of the population across the country has 4G coverage, only two out of 10 users use data regularly. 

He said that Nepal's mobile internet usage is very weak compared to other neighbouring countries.

Bhattarai said that as the use of 4G has increased, operators have started investing heavily to maintain their existence, but due to the lack of returns, the business of service providers has started to decline. 

He said that there is pressure on income due to high reinvestment in the telecommunications sector. 

He said that the situation does not look good as the income is continuously decreasing since service providers only need Rs. 6 billion annually to operate their services smoothly.

Chairman of Nepal Telecommunication Authority Bhupendra Bhandari said that as coverage of 4G across the country is not 100 per cent, it will be completed within a year. 

He said that it would be appropriate to shut down 3G first rather than shutting down 2G immediately, according to the capacity of the consumers.

Stating that the quality of telecommunication services has been continuously declining in recent times, Bhandari said that it is necessary to improve it. 

He argued that it is wrong to say that the size of telecommunication services has decreased, and that there has been a shift in business from telecom to ISP. 

He suggested that the focus should be on ways to increase business in a situation where new investment in the telecommunication sector is becoming low. 

Stating that 5G can be started in eight major cities of the country, Bhandari argued that it is not true to say that the technology is very expensive.

Chairman Bhandari said that the Authority is ready to give approval for 5G within a week of the operators submitting their applications.

Jabbor Kayumov, CEO and Managing Director of private sector telecommunications service provider Ncell, has appealed to everyone to stay alert, citing that Nepal's telecommunications sector is on the verge of a major crisis. 

Jabbor expressed concern that Nepal, which was ranked 117th two years ago in the GMS list, has now slipped to 119th, saying that the lack of a conducive environment has discouraged foreign investment in the sector.