Tariff hike needed as current rates unsustainable: says Airtel’s Mittal

Telecom tariff hikes are needed as the current rates are “volatile” and market conditions will be seen before the call is made, Sunil Mittal, president of Telecom Caesar and Bharti Airtel, has said.

On the issue of whether Chinese telecom equipment vendors will be allowed to participate in the next generation 5G network, Mittal said the big question is the decision of the nation and that “the decision that the country makes will be accepted by all “.

Where tariffs are concerned, the company has already taken a clear stand on the issue, he said, adding that Airtel believes that the tariff needs to be increased.

Tariff hike needed as current rates unsustainable
Tariff hike needed as current rates unsustainable

Mittal said in an interview, “” The current charges are unavoidable but Airtel cannot run without transferring the industry or transferring it to the regulator. ”

The industry needs a tariff hike at some point, adding that “we have to look at market conditions to do this”.

Mittal was answering a question in time for an imminent industry-wide tariff hike in the Indian market and whether Airtel would start it or wait for rivals to make their first move.

It is pertinent to mention that in August this year, Mittal described 16GB of data consumption in a month at Rs 160 as a tragedy. The company has ensured that the average revenue per user (ARPU) rises to Rs 200 and eventually Rs 300 for a sustainable business model. Bharti Airtel’s mobile ARPU increased from Rs 162 in the September quarter to Rs 128 in Q2 FY20 and Rs 157 in the preceding June quarter.

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Bharti Group Supremo – who has time and refocused on high taxes and leverage in the sector – said that telecoms are a “high capital-intensive industry” with a steady flow of investment in networks, spectrum, towers and technology And it was therefore important for the industry to be “sustainable”.

Mittal said, “This industry requires tons of money, it is a highly capital-intensive industry … buying spectrum, network, fiber, radio, towers … It is a continuously investing industry.”

Unlike the setting up of steel or power plants, or refineries, the telecommunications sector needs a continuous and recurring infusion of capital.

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“Every year, you have to spend billions of dollars to get new technology, more coverage, more capacity … so this industry has to be sustainable. The government wants India to be Digital India, and people stay connected.” We must leave it in their safe hands.

As it has been said, the Telecom Policy and the new Digital Communications Policy state that revenue maximization is not the objective, he said.

On the issue of Adjusted Gross Revenue (AGR) and the recent gap that has cropped up between DoT and the company when the next tranche of payments is due, Mittal said that Airtel has already paid Rs 18,000 crore. “Significantly more than anyone else”.

“We have paid Rs 18,000 crore … whatever they decide … we have paid significantly more than anyone else … so we will see, when the final decision comes.”

Mittal said the prices of 5G spectrum are “unaffordable” but said in the same breath that India has ample time for its 5G road map.

“Presently 5G spectrum prices are ineffective and India has no time. No one in the world is far away from 5G … even in countries of Europe … UK, US … 5 Zee coverage is still very sparse. So we are fine. India is not lagging behind, “he said.

Asked when he fully expected a 5-G rollout in India, Mittal said, “The point is, when you need it … connected cars, robotic surgery, that’s what it needs. So , Do we really have a fire. At the moment, I don’t think so. ”

On the question of whether 2G will continue to exist in India with the advent of new generation technologies, Mittal said that Airtel has already discontinued the entire 3G layer and will continue to move 2G customers to 4G .

Mittal said, “As soon as we can, we will continue to move our 2G customers to 4G, this process is going on. The process is just getting evolutionary now, every month.”

On whether Chinese telecom equipment companies will be allowed to participate in 5G, Mittal said: “It is not allowed or not being allowed. It is a question of the decision of the country … whatever decision the country makes Takes, will be accepted by all ”.

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