According to a source, Prime Minister Jhalanath Khanal called upon Chief Secretary Madhav Prasad Ghimire and Ministry of Information and Communications (MoIC) secretary Shreedhar Gautam and enquired about the possibility of waiving off UTL´s outstanding liability. "His instruction was clear: Resolve the royalty issue at the earliest," said the source.[break]
According to Nepal Telecommunication Authority (NTA), UTL has outstanding royalty to the tune of Rs 896 million to pay to the government. UTL, on the other hand, says it suffered a loss of Rs 4.44 billion ´because NTA did not fulfil the terms and conditions of the license´ and has claimed payment of compensation.
Meanwhile, officials at the Ministry of Information and Communications (MoIC) expressed surprise over the PM´s initiative as a case relating to non-payment of dues by UTL is being studied by the Appellate Committee of MoIC.
They even linked the PM´s pro-active approach to the news of Indian Finance Minister Pranab Mukharjee´s planned visit to Nepal later this year. India has been repeatedly seeking the government to waive off the royalty of UTL, an Indian telecom venture.
"Apparently, the news of a possible visit by Mukharjee suddenly turned government wary, particularly as they perceive it could affect Nepal from receiving other assistance from India," the source stated.
The government had earlier waived off the committed royalty of UTL worth around Rs 190 million for the period when the then King Gyanendra Shah seized the power and restricted operations of telecoms.
But the decision, endorsed by the cabinet, had drawn questions from the Commission for the Investigation of Abuse and Authority (CIAA). The constitutional anti-graft body had said the decision was against the existing laws.
"The row over royalty exists because UTL is refusing to comply with the law," said an NTA official. Going by the existing Nepal Telecommunication Act, telecom operators need to pay royalty either equal to the committed royalty fee or four percent of the total annual income, whichever is high.
But NTA officials said UTL has so far paid just Rs 160 million, which is equal to 4 percent of the total annual income, whereas going by its committed royalty fee, it should have paid well over Rs 1 billion.
Chief Executive Officer of UTL Arun Gupta, however, said that NTA´s claim of outstanding dues was foul because it never upheld the terms and conditions of license, something which inflicted huge loss on the company.
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