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🇳🇵 Nepal /Economy & Trade

Open up the telecom sector, but with caution

From Kathmandu Post · () English

Summarized and contextualized by DistantNews.

At a glance

Analysis Named sources Context piece
  • Nepal's current mobile service providers, Nepal Telecom and Ncell, face widespread customer dissatisfaction over patchy services and high prices.
  • The government is exploring the possibility of introducing one or more additional telecom operators to foster competition and improve service quality.
  • Challenges include limited radio frequency spectrum and infrastructure, but the government believes investing in these areas is crucial for Nepal's digital advancement.

Subscribers in Nepal are largely unhappy with the services provided by the country's two main mobile operators, Nepal Telecom and Ncell. Complaints frequently cite inconsistent service quality and high prices, suggesting a lack of competitive pressure.

one or even more

— Minister for Communication and Information Technology Bikram TimilsinaReferring to the potential number of additional telecom operators.

The current administration, led by the Balendra Shah government, appears to recognize this issue and is considering opening the market to new players. The Minister for Communication and Information Technology has spoken about the need for additional telecom operators, and the sector's regulator has formed a committee to study the matter. This move aims to stimulate competition, which proponents believe will drive improvements in both service quality and pricing.

If our infrastructure and regulations are inadequate, it is worth spending on them.

Advocating for investment in infrastructure to support new telecom players.

However, introducing new operators is not without its hurdles. Limited radio frequency spectrum and the rights-of-way needed for network infrastructure pose significant challenges. There are concerns that adding more providers without adequate infrastructure could paradoxically worsen services. Despite these obstacles, the government is exploring the entry of a third player, acknowledging the need to invest in infrastructure and regulations.

Nepal is already falling dangerously behind in productive use of telecom services, and thus missing out on all the attendant benefits of rapid digitisation.

Highlighting Nepal's lag in digital adoption due to telecom limitations.

Nepal lags significantly in the productive use of telecom services, with low data consumption rates compared to other South Asian nations. The government views expanding the sector as essential for rapid digitization and its associated benefits. By enhancing infrastructure and regulatory frameworks, the introduction of more players could boost service quality and user adoption rates. The Prime Minister's Office is expected to provide close oversight to the liberalization process, given the substantial revenues involved, to prevent potential corruption.

With better infrastructure and a more robust regulatory framework, the sector can be opened up to other players.

Stating the conditions necessary for successful market liberalization.
DistantNews Editorial

Originally published by Kathmandu Post. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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