The government of Nepal is contemplating reducing the current telecom license renewal fee, which stands at Rs 20 billion. Communication Minister Prithvi Subba Gurung called the existing fee “impractical” and acknowledged that it is not conducive to the industry’s growth. Speaking at a program organized by the Society of Economic Journalists (SEJON) on March 12, 2025, the minister highlighted the decreasing revenues from the telecommunications sector and declared that the Rs 20 billion renewal fee is unsustainable for the industry.
Under the current Telecommunications Act, 2053, Nepali telecom companies are required to pay Rs 20 billion every five years for license renewal. The government is now revising this regulatory act, aiming to introduce more industry-friendly provisions to help restore financial stability within the sector.
Minister Gurung also mentioned that Nepal Telecom (Ntc) had paid Rs 20 billion for a new license in Baisakh 2081, while Ncell had paid Rs 4 billion for its license renewal in Jestha 2081, with the remaining Rs 16 billion to be paid in four installments.
At the same event, Ncell’s CEO and MD, Jabbor Kayumov, expressed concern over the industry’s financial struggles. Reflecting on the industry’s decline since he left Nepal in 2016, Kayumov called the current situation “worrying.” He also suggested that the government revise its policies to attract foreign investment, particularly in light of the exit of Malaysian telco group Axiata, which cited challenging business conditions in Nepal. The existing Telco Act 2053 stipulates that a company with 80% foreign ownership will fall under state ownership after 25 years, which has been a major point of contention among industry stakeholders.
Industry expert Mohan Kumar Bhatta emphasized the need for policy revisions, particularly with regard to regulatory policies, taxes, and fees. He suggested the government draw lessons from India, Bhutan, and Bangladesh, noting that companies have heavily invested in 4G technology but are struggling to generate adequate revenues. The revision is expected to also address radio frequency policies in Nepal.
In support of these concerns, Nepal Telecommunications Authority (NTA) Chairman Bhupendra Bhandari acknowledged the heavy tax burden on telecom companies. He admitted that the current telecom tax system is not market-friendly and stressed the need to reduce fees, including the telecom license renewal charges. Bhandari proposed ending the provision requiring telecom companies to pay up to 48% of their revenue in taxes. He also hinted at introducing a provision for infrastructure sharing to lower operators’ expenses. As part of these changes, Nepal Telecom is shutting down 2G services on the 1800 MHz band, while Ncell plans to switch off 3G in 2025 to free up resources for 4G.
