Minister Gurung Calls for Urgent Reforms in Nepal’s Telecommunications Sector

Minister for Communications and Information Technology, Prithvi Subba Gurung, has underscored the need for legal reforms and stricter regulations to strengthen Nepal’s telecommunications industry. Speaking at an event titled “Revitalizing the Telecom Industry”, organized by the Society of Economic Journalists-Nepal (Sejon), the Minister highlighted sustainability and efficient management as key challenges in the sector.

He revealed that a new Telecommunications Act is in progress, with plans to revise the requirement for telecom providers to pay Rs 20 billion in renewal fees. Economic indicators in the telecom sector have been weakening, leading to a decline in government revenue, he noted. He also pointed out that telecom companies face increasing competition from internet service providers, calling for a new corporate strategy to address existing challenges, including policy strengthening, legal restructuring, and improved governance.

Ministry Secretary Radhika Aryal emphasized the importance of enforcing existing regulations and urged stakeholders to engage in dialogue to assess and address challenges. She noted that significant dues owed by internet service providers to the government have discouraged the possibility of subsidies for the industry.

Nepal Telecommunications Authority (NTA) Chair Bhupendra Bhandari acknowledged ongoing quality concerns in telecom services and assured that full nationwide access to 4G services will be achieved within a year. He also mentioned the possibility of launching 5G in eight major cities, asserting that the cost of 5G is not as prohibitive as some claim. The NTA is prepared to approve 5G operations within a week if service providers apply, he added.

IT expert Manohar Kumar Bhattarai highlighted the telecom sector’s declining contribution to Nepal’s GDP, which has fallen from 3.6% to 1.8%, despite the expansion of 4G services. He noted that only two out of ten internet users regularly rely on mobile data.

Ncell CEO and Managing Director Jabbor Kayumov warned that Nepal’s telecommunications sector is approaching a crisis, citing a decline in Nepal’s GSM ranking from 117th to 119th due to an unfavorable business environment discouraging foreign investment. The sector’s downturn has also impacted state revenue collection.

Kayumov confirmed that Ncell plans to discontinue 3G services by 2025 and suggested restrictions on the import of mobile phones lacking VoLTE (Voice over Long-Term Evolution) technology. He urged the government to transition the telecom industry towards a subscription-based model without further delay.