India considers cutting backhaul spectrum fees in half

India’s telecom regulator, TRAI, is weighing a proposal to cut backhaul spectrum charges by up to 50 per cent, a move that would trim operating costs for the country’s three largest mobile operators and lift their margins, The Economic Times reported. The plan, which still needs approval from the Department of Telecommunications, targets fees that now range from 0.15 per cent to 3.95 per cent of operators’ adjusted gross revenue.

Operators currently pay an estimated INR40 billion to INR55 billion ($446 million) a year for backhaul spectrum. A reduction would be particularly important for heavily indebted Vodafone Idea, which is trying to secure new bank financing to support INR500 billion to INR550 billion in planned capital spending while carrying deferred payment obligations of INR1.8 trillion as of the end of September.