Tk21,238cr spectrum renewal stalls over high interest charges, 20-year term

The operators have rejected the terms, arguing that they make the instalment facility commercially unattractive and difficult to implement, casting uncertainty over the renewal of their existing spectrum.

Robi Axiata’s Chief Corporate and Regulatory Officer Shahed Alam said requiring operators to pay upfront for a licence covering a period of 20 years was unacceptable. 

“We do not know which direction technology will take or what kind of spectrum will be needed in 10-12 years. We have to constantly adapt to changing spectrum requirements. In such circumstances, it is not reasonable to tie up capital now for something that we may need to use 20 years later. Mobile operators do not have the financial capacity to do so either,” he said.

“First, spectrum renewal should not be required for 20 years. Even if the period is 20 years, the fee should be paid in 20 annual instalments and should be interest-free,” he added.

Shahed said spectrum renewal fees were interest-free in other countries and that Bangladesh had followed the same practice in the past.

Another senior executive of a mobile operator, speaking on condition of anonymity, said the proposed licence renewal conditions were unreasonable from the industry’s perspective, making it impossible for operators to renew their licences on the terms set by the government.

The renewal deadline had already expired on 10 November, prompting the Bangladesh Telecommunication Regulatory Commission (BTRC) to extend the existing licences by one month to allow further negotiations.

The Finance Division finalised its position on 8 November after reviewing recommendations from the Posts and Telecommunications Division and the BTRC, adding the interest condition to the instalment facility. 

The government expects to collect Tk21,238 crore from the three operators for renewing their spectrum rights for 20 years, excluding taxes and VAT.

Instalments with costly conditions

Under the approved framework, operators will be encouraged to pay the full renewal amount upfront. Those choosing instalments will have to make 12 payments, with the first due within 30 days of receiving the renewal notice and the second within the following 180 days. The remaining 10 instalments will be paid annually.

No interest will apply if the outstanding amount is settled within one year. 

Beyond that period, simple interest will be charged from the third instalment at the yield of a 90-day Treasury bill. The rate has been set at 8.11%, based on the latest Treasury bill auction on 8 November.

A 15% annual charge will apply to any missed instalment. Operators will also have to continue paying their annual spectrum fees throughout the licence period.

The NBR’s no-dues requirement presents another obstacle. Several tax and revenue disputes between the operators and the revenue authority are pending in court, making it difficult for the companies to secure comprehensive clearance certificates even if they agree to pay the renewal charges.

Telecom executives say the conditions defeat the purpose of offering instalments, noting that the additional 8.11% interest would substantially increase the financial burden and make the facility commercially unattractive.

Operators have also questioned the 20-year renewal period, saying it could impose an unnecessary financial burden without delivering equivalent commercial benefits.

Industry executives point out that spectrum generally requires a technology upgrade after about 12.6 years, making a 20-year renewal period inappropriate. They also argue that charging interest on instalments is inconsistent with arrangements in other markets.

The Association of Mobile Telecom Operators of Bangladesh (Amtob) has sought lower spectrum prices, equal annual payments over 20 years and the withdrawal of annual spectrum fees.

How the bill reached Tk21,238cr

Under the BTRC’s valuation, the renewal price has been set at Tk316 crore per MHz for the 900MHz band, Tk264 crore for 1800MHz and Tk229 crore for 2100MHz, excluding income tax and VAT.

Grameenphone needs to renew 32.4MHz of spectrum, Robi 29.4MHz and Banglalink 21MHz.

The framework follows an earlier BTRC proposal submitted on 15 October, which put the cost at around Tk13,100 crore for 12 years and four months, with discounts of 10-30% on existing allocation prices. 

The revised plan extends the term to 20 years, raising the overall obligation. But the annual price calculation broadly follows the earlier proposal, so the gap between the two headline figures cannot be read simply as a rise in the unit price of spectrum.

Operators say the valuation remains high against international benchmarks, given Bangladesh’s low average revenue per user (ARPU) and heavy tax burden.

Investment capacity under pressure

The GSMA, the global mobile operators’ association, has also called for more affordable spectrum pricing.

In a letter to the BTRC chairman on 1 November, it recommended setting prices towards the lower end of the range suggested by the regulator’s consultant. Its 2025 study found that spectrum-related spending accounts for 15.7% of mobile operators’ recurring revenues in Bangladesh, compared with 10.4% in Asia-Pacific and 7.7% globally.

At a press conference on 5 November, Robi Axiata’s chief corporate and regulatory officer, Shahed Alam, said the proposed price for 1800MHz spectrum over 15 years was Tk198 crore per MHz, significantly higher than international levels.

“For every Tk100 in revenue, Tk56 goes to the government,” he said, arguing that lower spectrum prices would encourage operators to acquire more bandwidth and invest in their networks.

He said mobile data consumption could increase nearly 30-fold over the next decade, requiring substantial investment in network capacity.

Grameenphone’s chief corporate affairs officer, Tanveer Mohammad, said the combined burden of taxes, VAT and spectrum charges was putting pressure on operators and could make it difficult to maintain service quality.

Banglalink’s chief corporate and regulatory affairs officer, Taimur Rahman, said operators in Bangladesh faced higher tax and VAT burdens than their counterparts in India despite generating lower revenue per customer.

Dispute clouds future spectrum allocation

The dispute is also affecting the BTRC’s wider spectrum plans.

In June, the regulator allocated 20MHz in the 700MHz band, with Grameenphone acquiring 10MHz for Tk2,370 crore and the remaining 10MHz going to state-owned Teletalk.

The regulator is now preparing to auction another 8.4MHz in the extended GSM (E-GSM) band.

The proposed reserve price is Tk214 crore per MHz for 3.4MHz of relatively less constrained spectrum and Tk178 crore per MHz for the remaining 5MHz, which faces greater interference constraints.

Operators are divided over the timing of the auction. Robi wants it held soon, while Banglalink has urged the regulator to wait until the telecommunications policy is finalised.

BTRC Chairman Major General (retd) Md Emdad Ul Bari has said the auction is not directly linked to the policy and will proceed once the reserve prices are approved.

Operators have long complained about high spectrum costs, pointing out that nearly half of the spectrum offered at the January auction went unsold, reflecting weak demand at the proposed prices.