CMOs worry over power outages, 100% cash margin on imports

CMOs worry over power outages, 100% cash margin on imports

KARACHI: Cellular Mobile Operators (CMOs) are worried over continuous power outages and imposition of 100 per cent cash margin on import of certain phone equipment.

The CMOs in a letter to Pakistan Telecommunication Authority (PTA) highlighted certain issues that were hampering the quality of service (QoS).

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They said that CMOs as some of the leading corporate entities of the country and law abiding licensees of the authority have always strived to comply to all applicable License conditions, rules and regulations including provision of requisite level of quality, network and service availability.

The CMOs highlighted some critical economy-wide factors which are directly impeding and are expected to further severely constrain the operators’ ability to meet the existing QoS obligations/performance KPIs as well as our Network Rollout Obligations under the new License conditions.

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They said the current electricity shortfall, which is increasing with every passing day, is causing unplanned and prolonged load shedding nationwide especially in rural areas. Despite having backup power available in the form of generators/batteries, cellular operators are still finding it almost impossible to cope with the quantum of these power outages that are beyond our dimensioned backup capacity.

Moreover, the rapidly escalating fuel prices are not only placing extra constraints on provision of generators backup for our BTS sites, round the clock. This extra fuel consumption for back up purposes is also contributing to further demand for fuel rather than supporting the government objective of rationalizing fuel consumption across the board in these testing times. Considering the current situation, maintaining network availability and delivering QoS performance KPIs have become a massive challenge for the CMOs.

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In addition, recent increase in Letter of Credit (LC) cash margin on all telecom equipment imports from 10 per cent to 100 per cent by the State Bank of Pakistan (SBP) also applies to backup batteries.

Hence the imposition of increased LC cash margin has not only severely dented our ability to rollout more sites in order to meet the licensed QoS requirements, it also drastically impedes addition of more backup capacity to counter these extended power outages.

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In view of the above highlighted critical issues, we have a very serious apprehension that our licensing QoS KPIs and Network Rollout targets will be further affected. We are taking this opportunity to timely inform PTA and trust that the Authority will take into account the circumstances beyond our control while evaluating the license compliance and enforcement matters.

They further highlighted the most recent fiscal and political developments have further impacted the already deteriorating health of capital-intensive telecom sector in Pakistan; and in the absence of immediate reversal of adverse directive(s) and elimination of electricity load shedding, the telecom operators would unfortunately be constrained to notify Force Majeure situation under special circumstances, outside the control of the major Telecom service providers of Pakistan.

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The CMOs requested to indulge the Authority with the relevant quarters for favorable decisions in order to enable the telecom industry to keep providing essential telecoms service to the masses.