Nepal | November 13, 2019

‘Digital Nepal’ dream can be achieved only by expansion, improvement of telecom services

• Rendezvous

Sujan Dhungana

The government’s vision of ‘Digital Nepal’ has not gathered pace especially following sluggish growth of the telecommunication industry in the country. Though access to telecommunication services is crucial to transform the country digitally, telecom companies and internet service providers have not been able to deliver accountable, reliable and accessible services. Sujan Dhungana of The Himalayan Times spoke to Gokul Prasad Baskota, minister of communications and information technology, to know more on different issues related to the domestic telecommunication sector. Excerpts:

What is your view on current state of telecommunication sector in the country?

The telecommunication sector in Nepal is growing gradually. However, telecommunication services and networks are yet to reach every part of the country, especially in rural areas and high Himalayas where human settlement is low. This is both a challenge and opportunity in the domestic telecommunication sector. Similarly, data services have been substituting voice call services in the telecommunication sector in recent years and it is a challenge to the government to ensure people’s access to internet and data services. Data shows that almost 50 per cent of the country’s population has access to broadband internet while over 135 per cent has access to mobile phone services. However, 69 village municipalities still do not have access to mobile phone services while 150 local units do not have access to broadband internet network. Thus, the primary focus of the government is to expand mobile phone services and broadband internet services to these areas. In a bid to ensure people’s access to mobile phone and internet services, the government has unveiled its vision of ‘Digital Nepal’ and we are committed to ensuring digital connectivity across the country within the next few years. For this, we have been developing the broadband superhighway across the country covering all major areas with high human density. We have already announced some tenders regarding the optical fibre laying project while some tender announcements are in the offing. It is only through the expansion and improvement of telecommunication services that Nepal can live up to its dream of becoming a ‘digital nation’. Similarly, quality and high-speed telecom and internet services play a crucial role in the growth of the telecommunication sector. In a bid to increase people’s access to broadband and other telecom services, we have already started installing BTS towers across different places. In places with difficult geographical terrain, we are discussing with Nepal Electricity Authority to use its electricity poles to connect the optical fibre and internet network. Expansion of broadband internet across the country is the backbone to capitalising the ‘Digital Nepal’ plan and we will develop this backbone in the next two years.

However, different broadband projects initiated by Nepal Telecommunications Authority have been stalled since long. Does this not affect ‘Digital Nepal’ vision?

I accept that broadband projects have been delayed. NTA had granted different broadband and optical fibre projects to telecom companies and internet service providers (ISPs) two years back and these projects should have been completed by now. However, I have noticed that telecom companies and ISPs have not made visible progress on the projects they were granted. Moreover, some telecom firms were found selling the project contract they received to some other firms after taking approval from NTA itself. The government will curb all these practices that have been delaying broadband projects. We will even cancel the project contract with those telecom firms and ISPs that are delaying their projects. The NTA is also responsible for the delay in project construction. Effective monitoring and regulation from NTA are necessary for the timely completion of broadband projects.

Telecom services in Nepal are comparatively costlier. Why is it so?

This is also true. Unless we make telecom services cheaper, we cannot increase people’s access to it. I believe that ISPs are the major player in making internet services costlier in Nepal. This is because they have not reduced internet fees in Nepal despite a significant fall in global bandwidth price in recent years. ISPs have maintained a sort of monopoly in the market. This has compelled us to impose 13 per cent telecommunication services charge on ISPs. Though there is an international practice that ISPs can take up to 22 per cent profit of the cost of bandwidth, ISPs in Nepal have been booking up to 67 per cent profit and are yet unsatisfied. Moreover, a number of ISPs and telecom firms have not paid millions of revenue to government. Hence, the government is thinking of scrapping the licences of ISPs that have not paid their dues to government and are making internet cost higher. The second reason behind high internet cost in Nepal is due to lack of telecommunication infrastructure. In this regard, the government plans to develop necessary telecommunication infrastructure and promote the culture of sharing infrastructure among ISPs and telecom firms.

Though the government had envisioned bringing in infrastructure service provider in the country’s telecom industry a long time back, it has not been able to issue licence for the purpose to any firm. What is delaying the process?

As per my knowledge, a few international firms have expressed their interest to develop telecom infrastructure in Nepal and share the infrastructure with domestic telecom firms and ISPs. Sharing telecom infrastructure will be crucial to bringing down the cost of telecommunication services in Nepal as telecom firms and ISPs today have to inject huge investment to develop their own infrastructure. I have been informed that NTA is currently analysing the applications. I believe that NTA will award such licences within the next few weeks. However, we will issue such licence to more than one firm as bringing in only one telecom infrastructure service provider will promote monopoly in the sector. Similarly, the government is also positive towards establishing a telecom infrastructure company in the country if ISPs and telecom companies are interested to invest in it.

Nepal Telecom, which is owned by the government, is fighting to remain competitive in the market and has not been able to expand its services effectively. Why is it so?

It is true that Nepal Telecom (NT) is lagging behind in the telecommunication market. There are numerous reasons behind it and one is that NT is obliged to be more service-oriented. NT has the responsibility to expand its service to extremely remote areas, which is highly costlier, as it is a government-owned entity with 92 per cent share of the government. However, private telecom companies do not prefer to take their services where there is limited business prospect. This is challenging to NT. The other thing is that NT needs to undergo difficult procedural and legal hurdles while taking a small decision related to service or procurement while it is not the case for private telecom firms. Along with this, lack of seriousness among bureaucrats towards their responsibilities and other management issues inside NT are also hindering the competitive growth of NT in recent years. Meanwhile, the government is committed to addressing all these issues gradually and making NT’s services more reliable, accessible and competitive.

Among others, NT is also lagging behind in expansion of 4G service compared to other private telecom firms. What is your take on this?

Along with the aforementioned legal and technical hurdles that NT has to undergo, the 4G service expansion of NT was hampered also because of the months-long probe of the Commission for the Investigation of Abuse of Authority (CIAA) into the tender process that NT initiated to expand the 4G service. After almost nine months, the anti-graft body has directed our ministry to take necessary decision to expand NT’s 4G services. Based on the direction of CIAA, the government will soon take necessary steps to expand 4G service of NT aggressively.


A version of this article appears in print on November 13, 2018 of The Himalayan Times.


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