PM says Govt negotiating with profitable Telecom companies to slash rates by 50%

Third Telecom player to be allowed to boost competition

During the recent question hour in the National Assembly, Kengkhar Weringla Constituency’s MP Dorji Wangmo raised concerns about Bhutan’s high internet charges and poor connectivity. She queried about the timeline and extent of these reductions, and how the government plans to compensate for the potential loss of revenue from reduced rates.

She emphasized that in the digital age, affordable and accessible internet is essential for various services and education. Highlighting the government’s campaign pledge to reduce data charges by 50% or make them equivalent to Indian rates.

In response, the Prime Minister acknowledged the high cost of internet services in Bhutan and underscored the internet’s crucial role in business expansion and educational growth. He pointed out that Bhutan Telecom has 490,000 users and TashiCell has 270,000 users, surpassing the country’s population due to widespread use of dual SIM services.

“Bhutan Telecom’s data package for example, with a Nu 499 data package, one gigabyte costs Nu 59. With a Nu 699 data package, you get 23 gigabytes, making each gigabyte about Nu 30. In comparison, watching a movie on platforms like Samuh requires at least two gigabytes,” he said.

He said that there is 22,000 who use broad band services which are mostly for offices and for business. Despite this, the cost of the internet services is really expensive.

He contrasted this with India’s internet costs, where a gigabyte from Airtel costs Rs.6, highlighting the significant disparity. He also mentioned that a 30 Mbps leased line in India costs only Rs.16,500 per month.

“This disparity in internet service rates hinders people, especially those in remote areas, from fully utilizing the internet and hampers development,” the Prime Minister said.

To tackle these issues, the government plans to negotiate with the two telecom operators to potentially reduce data charges by up to 50%. Furthermore, there are plans to introduce a third telecom operator within the year to boost competition and potentially lower costs.

Regarding concerns about who will bear the loss from lowered internet service costs, the Prime Minister revealed that Bhutan Telecom, with an annual capital of Nu 6 billion, still manages to make about Nu 2.5 billion in profits after expenses and taxes. This indicates a potential to reduce rates without significantly impacting profitability.

Additionally, the internet rate will decrease after the third internet gateway is introduced this year.

He also mentioned ongoing discussions with Starlink, an international internet provider operated by an American company, which could further lower rates if negotiations are successful.

“The internet plays a crucial role for everyone, and we are committed to ensuring that internet services are not only affordable but also available to everyone in the country,” the Prime Minister said.