The Future of Ncell: Why a 25-Year License Extension is Vital for Nepal’s Telecom Sector
3rd January 2026, Kathmandu
Ncell, the leading private sector telecommunications provider in Nepal, is approaching a critical juncture. Having received its GSM mobile service license on September 1, 2004 (Bhadra 16, 2061 BS), its 25-year operational term is set to conclude on September 14, 2029 (Bhadra 15, 2086 BS).
The Future of Ncell
The Legal Deadlock: Ownership vs. Operation
According to Section 33 of the Telecommunications Act, 1997, if a company has more than 50% foreign investment, its land, buildings, machinery, and infrastructure must transfer to the Government of Nepal upon the expiration of the license. With approximately 80% foreign ownership, Ncell currently falls under this provision.
While the government renewed Ncell’s license for another five years last August, it did so under stringent conditions. In response, Ncell has submitted a detailed memorandum to six government bodies, including the Office of the Prime Minister, requesting a framework that ensures service continuity beyond 2029.
The company’s plea is built on four pillars: legal interpretation, economic contribution, consumer interest, and digital evolution.
Challenges and Proposed Solutions
Ncell views recent government decisions as “changing the rules in the final minutes of the game.” Amendments to the Telecommunications Regulations have restricted changes in share ownership, and the Cabinet has made several decisions that negatively impact the company’s operational flexibility.
The Issue of Inequality: There is a visible disparity in how the government treats market competitors. For instance:
Nepal Telecom: Allowed to pay license renewal fees in interest-free installments.
Ncell: Burdened with a 10% interest rate on similar installments.
Such discriminatory practices signal a potentially hostile environment for private and foreign investment.
Ncell’s Strategic Proposal: To align with the spirit of the law while maintaining its business, Ncell has proposed:
Increased Local Ownership: Transitioning over 50% of share ownership to Nepalese individuals or entities.
Public Offering (IPO): Issuing shares to the general public to transform into a majority Nepalese-owned company.
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Technological Investment: Committing to heavy investment in 5G and high-speed fiber networks.
The Economic and Social Stakes
The argument for Ncell’s continuity isn’t just about corporate profit—it is about national stability.
Fiscal Contribution: Ncell is one of Nepal’s largest taxpayers, contributing roughly Rs 18 billion annually. To date, it has paid over Rs 360 billion to the state treasury.
Foreign Direct Investment (FDI) Signal: International investors watch Ncell as a barometer for Nepal’s investment climate. Mistreating a successful multinational could deter future FDI.
Employment: The company provides direct and indirect employment to over 100,000 Nepalese citizens.
Digital Ecosystem: From mobile banking and fintech to e-governance and telehealth, millions of Nepalese rely on Ncell’s network.
The Risks of Non-Renewal
If Ncell’s operations were to cease or be forcibly nationalized without a clear transition, the consequences would be severe:
Capacity Crisis: Nepal Telecom currently lacks the infrastructure to absorb Ncell’s 14 million users. A service disruption would leave millions, especially in remote areas without connectivity.
Technological Stagnation: Telecommunications requires constant, massive capital expenditure. If a company knows it will lose its assets soon, investment in new tech like 5G stops, leading to a “digital decay.”
The “Ghost Company” Risk: History shows that state-managed takeovers of private telcos (like the cases of Smart Telecom and UTL) often result in the collapse of the service rather than its improvement.
Conclusion
For a nation pursuing a “Digital Nepal” vision, the goal should be to attract a hundred Ncells, not discourage the one that exists. Forward-looking policies that protect consumer interests and respect the lifecycle of high-tech investments are essential.
Ensuring Ncell’s continuity within a fair legal framework is not a favor to a corporation; it is a necessity for Nepal’s economic and digital sovereignty.
For more: The Future of Ncell
