Yadav says govt will give Nepal Telecom a longer leash
KATHMANDU, FEB 05 -
Minister for Information and Communications Raj Kishor Yadav has said that the government was committed to removing legal hurdles preventing Nepal Telecom (NT) from being competitive in the telecom market.
The stated-owned telecom giant has long been complaining that the Public Procurement Act (PPA) has been a major bottleneck in speedy implementation of its plans. As the government owns 92 percent of NT, it has to follow the PPA when purchasing goods and service. NT has been grumbling that delays imposed by the PPA have resulted in its being overtaken by private companies which are not tied down by such hassles.
“The government is committed to making the necessary amendment to the laws to make NT competitive,” said Yadav while addressing a function organised to mark the ninth anniversary of NT on Monday.
Amid growing competition with private companies, NT has been demanding for the last four years that the government bring a strategic partner. However, the government has not been able to do so. Currently, the strategic partner proposal is under consideration at the Ministry of Finance.
“We are hoping to get the final decision of the government regarding the strategic partner soon,” said Amar Nath Singh, managing director of NT. He added that since the government owned 92 percent of the company, they had to follow government rules like other government offices which had frequently created problems in carrying out projects.
Nine years ago, the government had transformed the then Nepal Telecom muni-cation Corporation into a public limited company. According to NT, it had a total annual income of Rs 7.66 billion at that time, and now yearly income has increased to over Rs 36 billion. The company expects to pay Rs 19.61 billion in taxes to the government from the income of the current fiscal year.
However, the profit growth rate of the company has started to decline due to an increased penetration rate in the country and stiff competition from private mobile company Ncell. In a bid to expand services aggressively across the country, NT has been planning to install 10 million mobile lines and 2 million IP CDMA lines.
Singh said that the IP CDMA project would also make EVDO internet service available. “We are planning to take IP CDMA lines to all the major cities in the country within a month,” he said. The service will be extended to all the business areas of the country’s villages in one and half years, he added.
On the occasion of the anniversary on Monday, NT started providing WiMax broadband service from Biratnagar, Itahari, Dharan, Birtamod, Dhulabari, Bhadrapur and Kakkarbhitta in the eastern part of the country. As per NT, 50,000 internet lines will be distributed within the current fiscal year under the first phase of the WiMax project. The first phase will bring WiMax internet service to 1,800 village development committees in 38 districts.
Source: The Kathmandu Post
