MDMS Likely This Month: Says NTA Director Min Pr. Aryal

The much-awaited mobile software security software system MDMS is likely to begin this month. NTA Director Min Prasad Aryal told of its final preparations for the mobile security system at the 2nd national general convention of Nepal Mobile Phones Distributors Association yesterday (Dec. 4).

The Director admitted that the mobile security system endured a long delay due to COVID-19 despite seeking an early implementation from the current Fiscal Year 078/79.

“Within the jurisdiction of the institute, we are launching the MDMS this month and starting managing the mobile phone market. We are at the final stage of preparation for the security software. COVID-19 did delay our project. However, we are intent on kick-off by this month,” he said.

Finance Minister Weighs in

Meanwhile, Finance Minister Hon. Janardan Sharma also shared his version of MDMS discourse. Speaking at the same event, he said that Nepal should assemble mobile phones in the country to also minimize grey phones.

He pointed that mobile phones are still smuggled into the country just like they do with gold. Referring to the 25-30% of unauthorized phones circulating in Nepal, he said the government is firm on curbing the spread of grey phones in the country.

He said, “mobile phones have become integral to our lives. Connectivity, communications, entertainment, and everything is possible with a mobile phone. Therefore, it is not sensible to censor mobile phones’ spread nor possible. But we are committed to controlling the import of phones without their registration at NTA.”

The government previously asked mobile phone owners to register their devices before Bhadra 15 to kickstart MDMS from Shrawan 1st. This meant mobile phone owners had to register IMEI of their handsets on NTA’s portal or face possible blacklisting by the authority. However, the delay MDMS took meant it not only didn’t launch but also led to the continuity of grey phones in the Nepali mobile phones market.

A meeting back in Ashadh coordinated by the Secretary of the PM’s office and cabinet of ministers, Shishir Kumar Dhungana decided on this deadline for mobile phone registration. The meeting was attended by the representatives of NTA, the Customs Department, and the Mobile Phones Importers Association. They also decided the authority will send SMS to phone users to remind them of the mandatory phone registration.

Grey Phone Owners Didn’t Need to Worry?

However, it was later known that NTA would allow time to avoid disrupting communications for mobile phone users. MDMS itself has taken longer to come to life due to COVID-19 and NTA’s own delayed preparations. But the telecom authority has now fully prepared to implement MDMS from this month to keep a check on all mobile phones on all network in Nepal.

The government is embracing stringent efforts to ensure all-level coordination to make MDMS efficient as possible. The government will integrate NTA into Nepal National Single Window to process mobile phone imports into the country.

As per the budget announcement for FY 2078/79, the telecommunications authority NTA was known to disable unauthorized phones from Shrawan 1st 2078. Phones imported from abroad, and via third-party sellers for retail purposes in Nepal will come under the scrutiny of MDMS. Meanwhile, phones bought from authorized stores in Nepal won’t incur any threats.

Grey Phones In Nepal

Grey phones in Nepal are at large. There is an estimate of 25-30% of grey phones in the Nepalimobile phone market. The worse, people are using them without concern. this has not only put mobile phone owners’ safety at risk, it has also cost the government in revenues. But finally, the Nepal government is gearing up to sort out the issue. After all the talks, discussions, and preparations, NTA has finally got MDMS all ready to execute.

With this, the authorities will be able to monitor all the mobile phones operating in Nepal. NTA would also roll out its policies via updates on phones, and monitor users for anti-social behaviors. Besides, the government will be able to collect its due revenues when phones come via legitimate channels.

Checkout: Mobile Phone imports increased in Nepal despite COVID-19 Pandemic

How Do Grey Phones Enter Nepal?

In Nepal’s context, retailers smuggle phones into the country from India taking advantage of open borders. As they dodge the customs charges, they can sell those phones in the Nepali market for cheaper prices.

Secondly, people working abroad also bring such phones in large volumes every month. Such phones are sold very commonly in major cities in Nepal, especially at border areas and main cities under the nose of authorities. Places, where such phones are bought and sold, are called grey markets.

Nepal imports roughly one million sets of phones monthly. Out of those, 2,50,000 phones remain unauthorized. This has cost the government around NRs. 7 billion every month, Onlinekhabar reports.

A few months ago, Nepal Mobile Distributors Association organized an event with all the stakeholders (NTA, Phone importers, Customs, more). They all agreed about the chronic effects of grey phones on mobile traders and the government revenues and user safety.

MDMS in Nepal: To Curb Grey Phones

As the best solution, the government has implemented the anti-grey phones strategy in Nepal. Phase-wise implementation of MDMS will help keep track of every phone in operation inside the country. The project has seen many delays over the years and this time due to the COVID-19. This had obstructed the procurement of MDMS systems from Malaysia.

MDM system will also help to identify smuggled phones from the legitimately imported ones. It will also help in the retrieval of lost phones if required.

Earlier Mr. Purushottam Khanal, Chairman of Nepal Telecommunication Authority had said, “The government will implement a whitelisting program through MDMS within three months. After fully operational MDMS, every phone will be functional (mobile network wise) only after being registered to NTA.”

Grey phones are sold very commonly and are in use in all parts of the country. “The issue needs to be tackled with a broader approach”, said Mr. Binod Lamichhane, an Inland Revenue Officer at Naya Sadak.

Meanwhile, Tribhuwan International Airport’s customs chief, Mr. Shambhuprasad Marasaini pointed out that “2 thousand people land in Nepal every day. More than 50% of them bring mobile devices with them. They are not legally usable in Nepal.”

Additionally, “the open borders have been conducive for people to evade customs at checkpoints. People cross borders to purchase phones and daily essentials at a lower cost.” Armed Police Force DIG Mr. Ganesh Khada Magar said.

What Will MDMS Do To Your Grey Phone?

From now on, MDMS will come with several ramifications on grey phones operating on any network in Nepal.

• First of all, your grey phone will not be operational for telecom services from Shrawan 1st. As a concession, all operational phones with Nepali SIM cards will not be blocked immediately, as told by Deputy Spokesperson Mr. Achyutananda Mishra.
• In case such a phone is lost, one cannot lodge a police report for it. If one does, the chances are they will find themselves in jeopardy for using an unauthorized.
• Your new grey phone will be blocked out of any carrier network in Nepal. It will not be compatible with any telecom network from Nepal in the future.
• Since the unauthorized phone does not receive any signal, its utility will be a bare minimum. You cannot avail of any telecom service and the device becomes almost useless like a brick.

Then again, a grey phone evades government registration, taxes, and regulation. The black marketeer or the smugglers sneak into the country via illegal routers and circulate such phones at large. The public buys them because they come cheap without realizing the broader risk entails. Eventually, it also raises a moral question, whether one should use an illegal phone at all?

Grey Phones Were ‘Invisible’ During The Pandemic

According to the chairman of Mobile Phone Importers’ Association, Mr. Deepak Malhotra, “legitimate and grey phones’ ratio were even in 75/76 fiscal year. However, it went slumped to null during the COVID-19 pandemic.” He concludes that open borders are to blame for smuggled phones in Nepal.

Heavy Tax Encourages Grey Market?

Nepal Mobile Distributors association Chairperson Mr. Dinesh Chulpadho has said the government has been ineffective to contain the grey phone market in Nepal. He believes the cost of mobile devices is playing a role in widening unauthorized phones in Nepal.

The same mobile device costs less in India than in Nepal even after currency conversion. Those close to borders would rather choose to take risks and buy phones in India and dodge the authorities. They circulate these phones in Nepal as people always opt for devices at a bargain price if available.

The chief added that the government should ease the tax burden on devices to discourage phone smuggling. He claimed that the VAT on mobile devices led to higher costs in the country. “Exempting VAT on mobile phones will help reduce grey phones in the country.” He suggested.

About MDMS in Nepal

MDMS stands for the mobile device management system. The system helps to keep track of every mobile phone operational in Nepal, along with its locations. When this system comes into effect, authorities will be able to track down unauthorized devices and render them unusable on any mobile network within the country.

MDMS is in the news for a long time. It has been in the plan of the Nepal Telecommunication Authority (NTA) for years. Though the Centralized database of all phones was conceived long back, the MDMS was coined with an NTA project in 2018. But the outcome never came to fruition. The mobile importers in Nepal have also voiced their concern about its effects on business. As a result, all the stakeholders were standing on the same page.

How To Register Your Phone At NTA?

Registering your phone at NTA is a medium task. Before you want to submit your phone’s IMEI, it is advisable you confirm your phone’s status first. If your phone is already registered, you are spared further hassle. To learn whether your phone has been at the NTA records or not, visit this link. There you enter your phone’s IMEI and check for the response.

If your phone is not registered then visit this link. Sign up, fill up your phone’s detail and wait for a few days. NTA will verify your data based on your document, either passport or citizenship, and check for each detail and legitimize your device. You will get an SMS on your phone as confirmation.

Benefits of Implementing MDMS In Nepal

For now, the government registers IMEI of mobile phones through the NTA portal. But this practice also needs to improve as it has not been proportionate to address mobile phone-related issues.

With the introduction of MDMS however, it now keeps a record of every phone. This will help to keep accurate data of mobile phones that enter the country via legal routes. In case of stolen devices, the owner can request to block the device directly. At the moment, owners have to go through the hassles of first writing an application to the police, inquire at the NTA to locate their phones.

Read the detailed process for how to report and track lost/stolen phones online?

MDMS On Telcos’ Servers

But now the MDMS needs to be integrated into NTC, Ncell, and Smart Cell servers. So that every phone will access the mobile network after the verifications of the mobile in the central MDMS database at NTA. This will also help the phone owners when their phones are stolen. For eg., if someone lodges a complaint of their phone’s theft to the telco, the company will have the capacity to restrict any service when another SIM is detected on the stolen phone.

The Mobile device management system aka the Centralized EIR system will be beneficial for all; the government, traders, and mobile phone users. It will curb the circulation of unauthorized phones in Nepal and hence contain the grey phone market. The government will raise more revenues at the customs and the owners will be able to assure themselves of their devices’ legality.

Finally, after months of talk of MDMS, NTA says it will switch on the security software this month. Have you registered your phone at NTA though? If you haven’t you better hurry and relieve yourself from possible service disruption on your mobile phone. If you have more to ask or learn about MDMS in Nepal, do let us know in the comments/