Modi govt brings big bang reforms in Telecom, Auto & Drones: All you need to know

Union Cabinet, chaired by PM Modi, on September 15, approved a list of structural and process trajectory reforms in multiple industries, particularly in telecom and automotive industry. With an objective to generate employment, promote competitive markets, and safeguard interest of consumers, Union Minister of Railways, Communications and Electronics & Information Technology of India Ashwini Vaishnaw and Union Minister of Information and Brocasting of India Anurag Thakur announced latest amendments in telecom, auto and drone industries respectively, during a joint press conference.

Here's all you need to know about mega reforms:

Centre stated that outstanding performance of telecom sector in combatting COVID-19 crisis resulted in a massive surge in Internet data consumption. According to government, reform measures in said sector will furr boost connectivity. 

'Robust Telecom Sector'

Briefing media after Union Cabinet meeting, Telecom minister Ashwani Vaishnaw asserted that reforms would revamp framework of telecom sector exhaustively. 

• Approved four-year moratorium period on dues and rationalised definition of justed gross revenue (AGR) i.e. usage and licensing fee that telecom operators are charged by Department of Telecommunications. 
• With competition and customer choice, reform is seen to boost 4G proliferation, infuse liquidity and lure investment in 5G networks.
• 100% FDI (Foreign Direct Investment) in telecom via automatic route has been approved to boost investments.
• Bank Guarantees (BGs) rationalized: Huge reduction in BG requirements (80%) against License Fee (LF) and or similar levies.
• One BG is enough: No requirements for multiple BGs in different Licenced Service Areas (LSAs) regions nationwide.
• Centre is set to perform annual compounding of interest inste of monthly compounding. 
• Shifting from Prepaid to Post-paid and vice-versa will not require fresh Know Your Customers (KYC).
• KYC reforms: Self-KYC (App based) permitted. E-KYC rate revised to only One Rupee.
• No Spectrum Usage Charge (SUC) for spectrum acquired in future spectrum auctions.

In Auto Industry & Drones, to boost manufacturing capabilities

With a budgetary outlay of Rs 26,058 crore in Automobile and Drone industry, Cabinet meeting chaired by PM Modi, expected to climb investments close to Rs 4,75,000 crore in upcoming five years. Notably, Central government has approved a Production-linked incentive (PIL) scheme for Automobile Industry and Drone Industry to enhance country's manufacturing capabilities, said Anurag Thakur during joint press conference.

"PLI scheme will encourage industry to make fresh investments for an indigenous global supply chain of vanced Automotive Technology products. It is estimated that over a period of five years, PLI Scheme for Automobile and Auto Components Industry will le to a fresh investment of over ₹42,500 crores,  incremental production of over  ₹2.3 lakh crore and will create ditional employment opportunities of over 7.5 lakh jobs. Furr, this will increase India’s share in global automotive tre," Centre stated. 

"PLI scheme for auto sector will incentivise high-value vanced Automotive Technology vehicles and products. It will herald a new age in higher technology, more efficient and green automotive manufacturing," Cabinet furr informed. 

PLI Scheme for Drones

PLI Scheme for drones and drone components industry will aid in boosting revolutionary technology in its strategic, tactical and operational utilities. A product-specific PLI scheme for drones with clear revenue targets and a focus on domestic value dition is a key strategy to building capacity, Centre stated.

" PLI for Drones and Drone components industry, will over a period of three years, le to investments worth ₹ 5,000 crores, an increase in eligible sales of Rs 1,500 crore and create ditional employment of about 10,000 jobs," Centre ded.

Fellow ministers' reactions on reforms in Telecom, Automobile & Drone industries

Taking to Twitter, PM Modi said, "Continuing reform trajectory, Cabinet has approved a PLI Scheme for Auto Industry and Drone Industry. This will give an impetus to manufacturing and bring sector at par with global trends as well as best practices."

Union Minister of Textiles of India, Piyush Goyal took to micro-blogging site, Koo, saying, "Big Bang Reforms!" 

Meanwhile, Ravi Shankar Pras said, "Some key reforms in Telecom sector approved by Union Cabinet today will boost growth of this sector, bring more investments, create job opportunities and improve ease of doing business."