DoT Proposes 5% AGR as Satellite Spectrum Usage Fee for Satcom Operators

The Department of Telecommunications (DoT) is set to propose a 5% fee on adjusted gross revenue (AGR) for satellite spectrum usage, as per The Economic Times. This decision, higher than the Telecom Regulatory Authority of India (TRAI)’s suggested 4%, may affect the launch prospects of major satcom players in India.

Satellite Spectrum Usage Fee Set at 5% AGR

DoT has opted to recommend a 5% AGR-based usage fee for satellite spectrum, diverging from TRAI’s earlier suggestion of 4%. This could influence the economics of global firms like Elon Musk’s Starlink, Amazon’s Project Kuiper, and Bharti-backed OneWeb, all of which are gearing up to launch services in India. These firms have received necessary licences but are awaiting final spectrum allocation, which is contingent on pricing approval.

Spectrum Allocation and Administrative Guidelines

Spectrum allocation will be administered under the new Telecommunications Act, covering both geostationary and non-geostationary satellites. TRAI had proposed an administrative allocation without an upfront payment. However, DoT is expected to finalise supporting rules for satcom firms following an agreement on most proposals through prolonged discussions with TRAI.

Read More: BSNL 4G Services at ₹1: How to Apply and Check Eligibility?!

Rejection of Subscriber Subsidy and DBN Proposals

TRAI had proposed an additional ₹500 per urban subscriber annually to encourage rural outreach and also recommended subsidies from the Digital Bharat Nidhi (DBN) for satellite terminal devices. 

DoT, however, rejected both suggestions. It cited the absence of any mechanism under DBN for direct subsidy transfers to customers, especially for terminal units costing between ₹20,000 to ₹50,000.

Next Steps and Cabinet Approval

DoT is preparing to submit its revised recommendations back to TRAI for further feedback, particularly on the 5% pricing decision and the DBN subsidy issue. Once TRAI responds, DoT aims to finalise the pricing structure and begin the process of administratively allocating the satellite spectrum to eligible operators across the country.

Conclusion

By endorsing a 5% AGR fee for satellite spectrum, DoT is setting a higher financial bar for upcoming satcom providers. With consensus emerging on most key policies, India is now closer to unlocking its satellite communication potential as approvals near completion.

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