This proposal is just one way of destroying their call centres and any Internet based transaction system they may want to develop with the outside world.
You might also want to note the following:
14. The ISP should block Internet sites and individual subscribers,
as identified by Telecom Authority.
15. The Government(Licensor) reserves the right to make changes in
the security considerations.
Don't forget the following kicker: Every international gateway location and/or the ISP node with a
router/switch having a capacity of 2Mbps or more shall be equipped with
a monitoring Centre at the cost of the ISP."
These are all excellent ways of destroying their IT industry, which is currently about 7% of total GDP. No organization with critical data who have any sense will transmit data over these sort of links.