Cause of Disruption
Government-ISP Conflict
- The government insists that ISPs clear their backlog payments on non-telecommunication services, including web service, co-location, hosted service, disaster recovery, managed service, data center, and cloud service.
- However, ISPs argue against paying for non-telecommunication components, claiming it is against the law.
Parliamentary Intervention
- The parliamentary Public Accounts Committee previously ordered the government to exempt ISPs from taxes on non-telecommunication components.
- Following this intervention, the Nepal Telecommunication Authority (NTA) requested the Inland Revenue Department not to subject ISPs to telecommunication charges for non-telecommunication services.
Pending Dues and Central Bank Refusal
- ISPs still owe dues worth Rs 3 billion to Indian companies.
- The Ministry of Communication and Information Technology is refusing to recommend the central bank release funds due to the issue of pending dues.
Impact on ISPs
- WorldLink Communications, a major ISP, had its international links disconnected due to non-payment.
- ISPs in Nepal face challenges in remitting payments due to a lack of permission from the Nepal government for foreign exchange.
Vendor Caution
- Nepali ISPs source 70 percent of their internet from Airtel.
- Airtel has cautioned them that supply to Nepali companies may be disrupted unless dues are settled.
Customer Apologies and Negotiations
- Vianet Communication Ltd, another ISP, apologized to its customers for the disruption caused by Indian bandwidth companies.
- ISPs are negotiating with Indian service providers (including Airtel) and government authorities to resume services promptly.
ISP Landscape
- Nepal has 20 ISPs operating in the country, including state-owned Nepal Telecom.
- These ISPs collectively provide internet services to approximately 9.10 million people.
Government wants ISPs to settle Taxes
There’s been a recent issue with internet services, with blame flying between Internet Service Providers (ISPs) and the government. The Ministry of Communication and Information Technology (MoCIT) stepped in to clarify that the ISPs are at fault for a recent disruption due to their failure to pay required taxes.
Some ISPs blamed the government for delays in allowing money transfers to their Indian vendors, but MoCIT debunked these claims, pointing out that the ISPs’ unpaid taxes were the real issue.
The disruption caused widespread problems for people across Nepal, sparking debates about who’s responsible.
Nepali ISPs haven’t settled their bills with Indian bandwidth suppliers, leading to service interruptions. ISPs say delayed payments from Nepali companies caused Indian suppliers to cut services.
The government and ISPs have been at odds for years. The government wants ISPs to pay outstanding bills for non-telecommunication services, but ISPs argue it’s not fair.
MoCIT reminded ISPs of their duty to collect fees upfront from customers, including contributions to government funds. Rules warn of penalties for non-payment.
ISPs still owe about Rs 3 billion to Indian companies. MoCIT won’t recommend fund releases from the central bank until tax issues are sorted.
Bishal Sapkota from MoCIT stressed following the law and avoiding actions that harm essential services and the economy.
Most ISPs have paid up, but a few haven’t. MoCIT says non-compliance could disrupt services.
MoCIT keeps reminding ISPs to pay up, warning of the consequences of not doing so.
MoCIT recently has also released the notice regarding the blame from IsPS:
What do you think? Who is wrong here?
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