Broadband internet services in many parts of Nepal were disrupted on Thursday due to payment defaults by Indian vendors, causing private operators to face connectivity issues. The disruption led to notices being issued by private internet service providers in Nepal, informing customers of either disrupted services or slow connections. However, the state-run Nepal Telecom continued to provide internet services without interruption.
Two private mobile services in Nepal were still operational, but their internet speed was noticeably affected by the disruption. The root cause of the problem lies in the inability of private ISPs in Nepal to make payments to Indian vendors for several months. This financial challenge arose as the government has not facilitated the transfer of foreign currency from banks to the private companies for payment.
The government's stance on withholding foreign currency support is linked to the private companies' outstanding tax obligations on specific services they offer. The private ISPs argue that they are exempt from such taxes, leading to a deadlock in resolving the issue. Wlink Communications, the largest ISP in Nepal, explicitly pointed fingers at the government for the disruption, stating that their upstream provider disconnected internal links due to nonpayment.
The notice issued by Wlink Communications highlighted the predicament faced by ISPs in Nepal, emphasizing that the inability to remit payments was directly tied to the government's reluctance to authorize foreign exchange transactions. As a result, the internet services sector in Nepal is grappling with operational challenges, impacting both businesses and consumers. Despite the disruption faced by private operators, the government has not provided an immediate response to address the situation.
