India Inc on Thursday welcomed the government's decision to defer receipt of spectrum auction installments due from telecom service providers, saying the move will provide headroom to the sector currently facing stress, generate job opportunities and drive consumer demand.
The government on Wednesday doled out a Rs 42,000 crore relief to debt-laden telecom companies after it agreed not to take any payments for spectrum they use for the next two years.
The Union Cabinet headed by Prime Minister Narendra Modi approved giving Bharti Airtel, Vodafone Idea Ltd and Reliance Jio an option to avail a two-year moratorium on payments they were supposed to make in yearly installments for the spectrum bought in auctions.
This is a great breakthrough in the economic reform system and will have a positive impact on the growth and development of telecom sector and the economy as a whole, PHD Chamber of Commerce and Industry President D K Aggarwal said.
Deferment of spectrum auction installments will provide a pronounced relief to stressed telecom service providers leading to their continuous operations, ease their cash outflow and give them window to make payments for statutory liabilities and interest on bank loans, Aggarwal said.
As the telecom sector is one of the major growth driver of economy, this move is welcomed as it will generate employment opportunities for the potential workforce, drive consumer demand sentiments in the economy, provide further impetus and pave way to achieve USD 5 trillion economy going forward, he added.
"Another notable decision of the government is the relief provided to the telecom sector by way of deferment of receipt of spectrum auction instalments due from telecom service providers for the year 2020-21 and 2021-22," Ficci President Sandip Somany said.
The move should provide some headroom to the telecom sector in the country as it is seeing a lot of stress, he said.
Describing the strategic sale of CPSEs as a major reform, Assocham said the decision reflects the clear mind set of the government about steadily moving out of businesses.
"The underlying thinking is that the government has no business to be in business. It is a welcome and a major policy change," Assocham President BK Goenka said.
Besides, the bill cleared by the Cabinet for allowing fixed term employment is a good and decisive starting point for labour reforms, Goenka said. The Centre on Wednesday approved the Industrial Relation Code Bill, which is the third code under labour reforms.
The government wants to codify 44 central labour laws into four broad codes.
While the Code on Wages has already been approved by the Parliament, the Labour ministry will push the Code on Occupational Safety, Health and Working Conditions Bill in the Budget Session. The Code on Social Security is in pre-legislative stage.
The bill provides for setting up a two-member tribunal (in place of one-member), thus introducing a concept that some of the important cases will be adjudicated jointly and the rest by a single-member, resulting in speedier disposal of cases.
The Cabinet Committee on Economic Affairs (CCEA) also approved sale of government's entire 53.29 per cent stake along with transfer of management control in the country's second biggest state-owned refiner Bharat Petroleum Corp Ltd (BPCL) after removing Numaligarh refinery from its fold.
It also gave a nod to sale of the entire government holding of 63.75 per cent in Shipping Corporation of India (SCI) and 30.9 per cent stake in Container Corp of India (Concor).