New Delhi, Sep 29 (IANS): The Telecom Commission on Friday approved the much-awaited extension of deferred spectrum payment liability till 16 years, an official source said here.

The panel has also approved the shift from pending lending rate (PLR) to marginal cost of funds based lending rate (MCLR) regime for calculation of interest on delayed payment of licence fees and spectrum usage changes plus 400 points.

It means the interest rate on delayed payments will come down to 12 per cent.

Commenting on the developments, Rajan S. Mathews, Director General, Cellular Operators' Association of India (COAI) told IANS: "We appreciate the government for addressing our concerns. It does help in increasing the cash flow in the industry. It will ease payment burden."

He further added: "However, it does not solve long-term systemic financial problems in the industry. The whole issue of adjusted gross revenue (AGR), licence fee and spectrum usage charges need to be addressed quickly."

It is learnt that the matter of AGR from spectrum trading has been referred to the Law Ministry.

According to sources, the guiding principles for the new telecom policy have been approved. The Telecom Commission will get the draft policy by November 30.

The inter-ministerial group's (IMG) recommendations for improving the sector's health, which were approved by the Telecom Commission, will now be placed before the Cabinet, sources said.