Date:16/09/2004 URL: http://www.thehindubusinessline.com/2004/09/16/stories/2004091602890100.htm

Back Maran pushes for broadband sops — Holds talks with Chidambaram

Our Bureau

New Delhi , Sept. 15

THE Communications and IT Minister, Mr Dayanidhi Maran, today met the Finance Minister, Mr P. Chidambaram, to seek fiscal incentive for broadband usage.

The Government is scheduled to announce the policy initiative tomorrow.

The meeting assumes significance because the Finance Ministry had earlier rejected all the tax incentives and relaxation in duties suggested by the Telecom Regulatory Authority of India to push up broadband usage.

According to Government sources, the discussion between the two Ministers revolved around providing tax sops for broadband usage. Mr Maran, accompanied by the Telecom Secretary, Mr Nripendra Mishra, is understood to have met the Prime Minister later.

The telecom regulator had suggested a number of fiscal measures including a five-year tax holiday for Internet Service Providers offering broadband services. Most of the fiscal measures, suggested by TRAI, were objected to by the Finance Ministry.

Initiatives like `open sky policy' for VSAT and Direct-to-Home (DTH) operators were also shot down by the Department of Space. The draft policy guidelines prepared by the Department of Telecom had not included any fiscal incentives suggested by the TRAI, which made the policy more of a vision statement.

Some of the measures that are expected to be announced as part of the broadband policy include de-licensing of Wi-fi services.

The Government will explore alternative spectrum bands specifically for deploying broadband services and offer price incentive for its usage. The policy also envisages subsidised leased lines for those Internet Service Providers connecting to the National Internet Exchange.

On the issue of local unbundling, which would allow ISPs to ride on large telecom operators' national network to offer broadband services, the Government is likely to leave it to individual operators whether or not to un-bundle their last mile. The Government will undertake a review of this issue after 31 March 2006.