Could 4G-5G mobile plans become more expensive due to this budget decision?
Finance Minister Nirmala Sitharaman presented the budget for the financial year 2024-25, in which she made many important announcements. During this period, along with other sectors, special attention has also been paid to the telecom sector. In which the most important announcement was the increase in duty on printed circuit board assemblies i.e. PCBAs on select telecom equipment. Due to its increase, the problems of mobile users may increase and mobile phone plans may become costly. At the same time, there is a possibility of delay in the launch of 5G. In fact, the Finance Minister has increased the duty on PCBAs from 10% to 15% in the budget, which will directly reflect on mobile phone plans.
So will the plans get expensive?
Due to the increase in telecom equipment prices due to the announcement on PCBA in the budget, this step may affect mobile users in many ways. Due to the increase in PCBA duties, telecom equipment prices may increase, which will indirectly affect mobile service providers. This will also increase their operating costs. Due to this, telecom companies may make their tariffs more expensive in the short term and the 5G deployment work may also slow down.
Impact on the telecommunications sector
For telecom operators, rising operating costs mean that customers may face higher service charges or more expensive tariffs. The Cellular Operators Association of India had demanded that the tariff be reduced to zero so that the 5G rollout could be accelerated. On the contrary, the tax has been increased in the budget, so the telecom sector may face tough challenges in the future.
will be affected
Following the PCBA fee hike, there may be problems in the network expansion of the telecom sector in India. This will make network expansion costly and slow. Due to the lack of local manufacturing of 5G equipment in India, the rollout of 5G may be delayed. Apart from this, due to the PCBA fee hike, there may also be a delay in infrastructure development, which may affect the quality and coverage of mobile service. This may have a particular impact on rural and remote areas.
Due to the increase in PCBA tax, operators may postpone their investment plans for some time. However, this may boost local manufacturing but it will take time to develop. Despite all the challenges, the telecom sector is hopeful that the government will take appropriate measures in time so that the progress of the Indian telecom industry is not hampered.
Tremendous increase in data usage
Data consumption is also continuously increasing in the country, something that companies are taking full advantage of. There was a reduction in tariffs after the introduction of 4G service. On the one hand, internet access in the country has increased considerably, but now, since the launch of 5G service, technology is advancing and data usage has increased.
