Telcos, ISPs contributed Rs 1.29b to rural telecom fund last fiscal year

TELECOM companies and internet service providers contributed Rs 1.29 billion to the Rural Telecommunications Development Fund (RTDF) in last fiscal year 2012-13 — up 40 percent compared to their contribution in the previous year. The growth is mainly supported by increased income of telecom companies. Under the Telecommunication Act 1997, Nepal Telecommunications Authority (NTA) licencees are required to contribute 2 percent of their total annual income to the RTDF, which has been established for the development of rural telecom. The authority, in 2011-12, had collected Rs 920 million as RTDF fee from its

licencees. NTA Director Purushottam Khanal said the increasing size of the contribution being made to the RTDF is a result of rising income of major licencees like Ncell and Nepal Telecom. The contribution of Rs 1.29 billion made in 2012-13 by the NTA licencees is from their income during 2011-12. The licencees had earned a combined Rs 64.52 billion in 2011-12. Two major licencees — Nepal Telecom and Ncell — contributed Rs 650 million and Rs 580 million, respectively, to the fund. In 2011- 12, Ncell had paid Rs 350 million, while Nepal Telecom Rs 520 million. Currently, the NTA has over Rs 7 billion in the RTDF, but it has not been able to utilise the resources for rural telecom development. The current growth trend in the telecom sector suggests the contribution to the fund will further rise in the current fiscal year. “This year, the licencees are expected to contribute over Rs 1.5 billion to the fund,” said Khanal, adding that the amount collected in the last fiscal year dœs not include the fines worth over Rs 180 million imposed for late payment. All six telecom companies — Ncell, Nepal Telecom, United Telecom, Smart Telecom, Nepal Satellite Telecom and STM Telecom Sanchar — and many other internet service providers were imposed fine for not paying the RTDF fee on time. The NTA said with the Ncell objecting the fine provision and filing a writ petition against it, a case is under consideration of the Supreme Court. The telecom regulator had imposed 25-200 percent fine to telecom companies and ISPs as per the RTDF Bylaw 2012. NTA Assistant Director Surya Lamichhane said the licencees have to pay the RTDF fee within the first three months of the fiscal year to avoid penalty. However, the telecom companies and ISPs have long been arguing that the provision of fine for payment delay is not practical as their annual audit dœs not conclude within the first three months of the fiscal year. Based on the bylaw, the NTA can impose a 25 percent fine in the fourth month. “If a licencee pays the fees between the fifth and sixth months, the fine will be 50 percent. If the payment is made between the seventh and ninth months, the fine will rise to 100 percent,” said Lamichhane. “The fine will be 200 percent if the payment is made between 10th and 12th months.” CONTRIBUTION TO RTDF FISCAL YEAR RTDF COLLECTED 2012-13 Rs 1.29 billion 2011-12 Rs 920 million 2010-11 Rs 698 million 2009-10 Rs 552 million 2008-09 Rs 430 million Source: Nepal Telecommunications Authority