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Moderate participation expected in spectrum auctions: ICRA

In addition, the telcos are required to pay Rs 90,000 crore as AGR dues as per the Supreme Court order, but the payment terms are yet to be finalised in the court.

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Mumbai, May 27 : Rating agency ICRA expects moderate participation for the upcoming spectrum auctions at Rs 55,000-Rs 60,000 crore due to the limited financial flexibility of the industry.

The Telecom Regulatory Authority of India (TRAI) has recommended auctions with one of the largest quanta of spectrum on offer – more than 8,500 MHz, which at reserve price, is valued at around Rs 5.7 lakh crore.

However, ICRA expects a relatively muted participation fetching around only Rs 55,000 – Rs 60,000 crore to the exchequer.

“This, along with the impending AGR dues, are expected to result in further elevation of the industry debt to around Rs 4,60,000 crore as on March 31, 2021 despite sizeable deleveraging done by the telcos as well as the anticipated improvement in cash flow generation post the tariff hikes,” ICRA said in a study on Wednesday.

“Such a high valuation is on account of high reserve prices and high quantity of spectrum for the newer bands i.e. 700 MHz and 3300-3600 MHz, which are primarily expected to be used for 5G. The 700 MHz was put to auction in October 2016 where it went unsold and thereafter the price for this band has been revised downwards for the forthcoming auction.”

According to ICRA’s Assistant Vice President for Corporate Ratings Ankit Jain, the ratings agency foresee minimal participation in the 700 MHz band and expects relatively better participation in the 800 MHz and 1800 MHz bands, that beholds significant expiries for incumbents in 2021, and thus the telcos will acquire it for continuation of 4G services.

The Centre has budgeted Rs 1.33 lakh crore as non-tax receipts from the telecom sector for FY2021.

“While the regular receipts – license fee and spectrum usage charges – are expected to fetch around Rs 20,000 crore, the telcos will have to pay Rs 20,000-25,000 crore as upfront payment for the forthcoming spectrum as per ICRA expectations,” the statement said.

In addition, the telcos are required to pay Rs 90,000 crore as AGR dues as per the Supreme Court order, but the payment terms are yet to be finalised in the court.

“If the telcos are required to pay this amount upfront, the Government will meet its target for FY2021, while in case of staggered payment terms stretching to 20 years, there will be a sizeable shortfall in the GoI collections.”

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Sagging electoral prospects behind Trump’s H-1B action

The real impact of the presidential proclamation, therefore, will be two-fold. First, as long as Trump is President, it will undoubtedly cause many international students, who are looking at the US as a potential destination for higher studies to reconsider their decisions.

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On June 22, US President Donald Trump issued an executive order suspending the entry of a number of non-immigrant work visa holders into the US till the end of the year. The visa categories affected include, most notably, H-1B, which has been used by more than a million Indian information technology professionals since the 1990s and L1 visa used by US companies to bring in workers from their Indian offices.

During his campaign for President four years ago, candidate Trump consistently railed against the H-1B programme. However, after he moved into the White House, Trump left the visa programme untouched in the first 43 months of his presidency, even as he delivered on most of his controversial campaign promises, such as the Muslim ban and dumping of multilateral treaties like NAFTA and Paris Agreement, through executive actions.

There were two compelling reasons Trump didn”t act on the visa programme until now. The US economy had been doing very well until Coronavirus hit the American shores early this year. And, the tech industry, which employs three-fourths of the H-1B visa holders, has been doing even better.

The second reason is the formidable lobbying power of the industry. The four most valuable companies in the world, Amazon, Google, Apple and Microsoft, and Facebook have historically used the H-1B workforce to augment their profits. They were not going to let it go without a fight.

The influence these organizations wield was evident when Trump spared H-1B in his first executive order to curb nonimmigrant work visa holders issued on April 22. According to reports, H-1B was to be part of that proclamation but the White House was talked out of it by the industry.

So, what has changed between late April and today?

A number of things, but primarily it is Trump”s dimming re-election prospects. A steady stream of polls in the past few weeks has shown that the incumbent is trailing badly in the race against presumptive Democratic nominee Joe Biden. The President”s handling of the Covid-19 pandemic — his initial refusal to see it as a threat and then his inability to provide the leadership to contain it — has shaken people”s confidence in Trump”s presidency.

Prior to the onset of the Coronavirus, Trump was banking on making the election a referendum on his stewardship of the economy. But the pandemic, which has claimed more than 125,000 American lives, has also eliminated up to 40 million jobs.

Although some of the jobs have come back thanks to the multitrillion dollar stimulus package, the re-opening plans promoted by Trump have not produced substantial results. Now, with parts of the country closing down again, and the deadly virus spreading in southern and western states, there”s no sign of the economy turning the corner before the November election.

Consequently, Trump needs to be seen as doing something to save the economy and American jobs. H-1B, which has been a bogeyman for the protectionists and economic nationalists, is an easy target during this downturn, even though study after study has documented that the visa programme actually helps create jobs. The administration claims that the executive order is going to save more than half a million American jobs without giving details.

It should be noted that the order mainly impacts petitioners who are outside of the US who have not gotten their visas stamped on their passports yet. As a result, it will only have little impact in the short term on those seeking work in the US.

The US Citizenship and Immigration Service issues roughly 85,000 new H-1B visas annually of which 20,000 are for those with US master”s degrees. Most petitioners in this category are already in the US and they will not have any problem in starting their jobs in October, typically the time new visa holders enter the work force.

According to immigration attorneys, a significant percentage of the remaining 65,000 visas are claimed by dependents of H-1B and L-1 visa holders, as well as foreign students who have graduated from US schools, but did not get the visa under the master”s degree quota. These groups will also not come under the purview of the executive order, as they are already in the country.

The real impact of the presidential proclamation, therefore, will be two-fold. First, as long as Trump is President, it will undoubtedly cause many international students, who are looking at the US as a potential destination for higher studies to reconsider their decisions. During the Trump era, the US has already been losing potential students to nations such as Canada, Britain and Australia.

Second, despite the massive job losses in the broader economy, there are still vacancies in the tech industry that will have to be filled to move its economy forward. The US tech sector has said for years that the country doesn”t produce enough skilled workers and the industry will suffer without the intake of manpower through H-1B and L1 visa programmes. If it becomes more difficult for these companies to hire foreign workers, they would probably outsource more and more of these jobs to foreign destinations, including India.

It is an irony that, while Trump is trying to bring manufacturing jobs back to the US, his nonimmigrant worker visa policy could force more high-paying service jobs offshore. What makes it doubly ironic is that this action which Trump has taken to try to save his job as President will not do so.

Given the current state of affairs, it is likely that on election day November 4, the American people will fire Donald Trump. After that, the decision on what to do with information technology visas in 2021 and going forward will be in someone else”s hands. And, Trump will have to find a new place of employment for himself.

The good news is Biden has already stated that his administration will lift the H-1B ban.

(Frank F. Islam is an entrepreneur, civic and thought leader based in Washington DC. The views expressed are personal)

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Corona impact: CAIT demands de-sealing of Delhi shops

According to CAIT National Secretary General Praveen Khandelwal, estimates show that about 6,000 shops have been sealed in Delhi.

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New Delhi, July 4 : The Confederation of All India Traders (CAIT) on Saturday demanded that shops in Delhi be de-sealed immediately without further delay.

Accordingly, in a letter to the Union Urban Development Minister Hardeep Singh Puri, CAIT demanded that “Delhi sealed shops should now be de -sealed immediately without further delay”.

Besides, the traders’ body also called for the finalisation of Delhi Rent Act, “ending a long running dispute between the land lords and tenants in Delhi”.

Furthermore, CAIT demanded that traders should be allowed to participate in the consultation process of Master Plan 2041 which is being prepared for Delhi.

According to CAIT National Secretary General Praveen Khandelwal, estimates show that about 6,000 shops have been sealed in Delhi.

“Corona started since the beginning of the year 2020 and the traders of Delhi are faced with a big crisis of livelihood and in such a situation, it has become imperative that shops are immediately de-sealed,” he was quoted as saying in a statement.

“Keeping this in view, the Central government should take an initiative in this matter and pass an ordinance in which all sealed shops should be opened and all other problems related to sealing should be postponed for the time being thereby giving all traders a fair chance to do business.”

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Congress to PM Modi: Roll back imposition of tax on disability pension of defence forces

He cited that 20 Indian soldiers including commanding officer also had attained martyrdom on the fateful night of June 15. He insisted that some of them, god forbids, may also be disabled.

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New Delhi, July 5 : Leader of Congress party in the Lok Sabha, Adhir Ranjan Chowdhury, has written to Prime Minister Narendra Modi seeking a review and roll back the decision of the imposition of tax on disability pension of defence forces including Army, Navy, and Air Forces.

“I must appreciate your visit to the army hospital (crisis expansion capacity of 100 beds) at Leh where scores of Indian soldiers have been admitted who have sustained grievous injuries during their valiant fight against Chinese intruders at Galwan Valley,” said Chowdhury in a letter to the PM.

He cited that 20 Indian soldiers including commanding officer also had attained martyrdom on the fateful night of June 15. He insisted that some of them, god forbids, may also be disabled.

“In future how would those disabled army personals earn and run the livelihoods? Disability pension comes as succour to those brave soldiers,” he added in the letter.

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