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Government may look for third telecom operator: Prime Minister

If existing companies refuse to reduce data charges, the government would consider looking for a third operator. 

The government will consider establishing a third telecom company if the existing companies refuse to accept a 50% reduction in data charges. Prime Minister (PM) Dasho Tshering Tobgay shared this during question hour on July 5th, 2024 in response to a question from Kengkhar-Weringla Member of Parliament (MP), Dorji Wangmo about the government’s plan to reduce data charges.

The PM informed the House that he has made contact with Starlink and introduced it to Druk Holding Investment (DHI). Starlink is the world’s first and largest satellite internet constellation, operated by Starlink Services, LLC, a wholly-owned subsidiary of American aerospace company SpaceX, providing coverage to over 75 countries. They aim to provide global mobile broadband. SpaceX started launching Starlink satellites in 2019. As of early March 2024, the constellation consists of over 6,000 mass-produced small satellites in low Earth orbit (LEO).

Moreover, the PM announced that the government will initiate the establishment of a third Internet gateway to reduce internet tariff charges.

In her question, MP Dorji Wangmo asked, how and when will the data charges be reduced, and to what extent? She further queried if it would be reduced by 50% or made equivalent to rates in India and when Bhutan can expect to have stable and high-speed internet connectivity? She pointed out that data charges in the country are the highest in the region, with poor connectivity. “We are not able to provide necessary public services, especially with more and more services going online, hindering digital access crucial for services and education.”

The MP said that the average cost of 1GB of mobile data in India is INR 10, whereas the cost of 1 GB data in Bhutan is Nu.59, based on data from the Kingdom of Bhutan Digital Economy Development and Transformation Strategy by GovTech Agency and UNDP, of September 2023.  She added that the rate of Nu.59 per GB is for data package of Nu. 499, whereas most of the people in the rural areas, lower income groups and students cannot afford to recharge for Nu.499 or higher. As a result, they pay higher data costs for the commonly used package of Nu.99, i.e., almost Nu.100 for 1 GB (Nu.99 = 1.33 GB), which is quite high.

She further said that the government had also pledged to ensure stable and high-speed internet connectivity is available in every Dzongkhag, Gewog, and Chiwog, including all institutions such as government offices and schools and ensure no village or cluster of houses suffer from weak or disruptive telecom services. However she said that the current reality is that the internet connectivity in remote gewogs and chiwogs is very weak and there is zero connectivity in some places.

The Prime Minister acknowledged that internet has become essential for entertainment, research, education, business, and service delivery, but the high charges hinder its accessibility. He pointed out that Bhutan Telecom charges Nu 59 per GB for a 499 data package and Nu 100 per GB for 99 data packages, while Indian Airtel users pay 6 rupees per GB. “There is a huge gap in both package and lease-line users. For broadband, we are paying Nu 16,500 for 30 Mbps, whereas in India, they are paying 400 rupees for the same Mbps.”

The PM said that with poor connectivity and high internet charges, “our people are not able to get equal services like other countries, thereby creating a huge gap in the digital scenario. If there is no such service, there will be no development.”

The Prime Minister said that the government plans to discuss with Bhutan Telecom and Tashi Cell how to reduce data charges, phone prices, and internet costs by up to 50%. “However, if negotiations with the two telecom companies fail, then we will have to look into bringing a new service provider.” However, the Prime Minister noted that two telecom companies are sufficient for a small country like Bhutan.

In response to a question on how the government will address the potential loss of revenue from reduced rates in the form of taxes and dividends from the telecom companies, the PM stated that while telecom companies may not have very high profits, there is still a good profit margin. “For instance, in 2023, Bhutan Telecom made a profit of Nu 6 billion after reducing all expenditures, and there is still some room for reduction.”

The PM also assured that they are working on providing stable and high-speed internet connectivity in every district, Gewog, and chiwog. Meanwhile, the government has allocated Nu 10 billion for ICT development to stimulate the growth of the ICT industry and enhance technological infrastructure, thereby strengthening our economy.

Meanwhile, while delivering the State of the Nation Address, the PM said that Nu. 10 billion has been allocated for ICT development, to not only stimulate growth of the ICT industry but also enhance the technological infrastructure, thereby strengthening our economy.

By Nidup Lhamo, Thimphu