Following the text of letter of Rajya Sabha member Rajeev Chandrasekhar to P Chidambaram who heads EGoM on Telecom:
Dear Thiru chidambaram,
Sub: Decision reserve price and other issues relating to the 2G Spectrum auctions ordered by the Hon’ble Supreme Court of India.
The empowerment group of ministers (EGoM) has been tasked with a crutial role of evaluating and finalizing several key decisions, including the reserve price for the upcoming 2G spectrum auctions. Some of these decisions will permanently after the landscape of the telecommunication sector in india, including the competitive arena, cost to operators and price and quality of mobile, and in future, wireless broadband services to India’s citizens.
In this regard i have following submissions to make.
1. Ideally the work of a speecialist regulator –TRAI – should have been evaluated by the telecom commision with specific recommendations, since procedurally, the full telecom commision is required to take a decision given the sector – specific expertise and the resources that it has at its command. to leave these decisions to the EGoM without specific reccomendations on file that convey at least the mind and decision of the telecom commition is deeply worrying.
- The EGoM must be acutely aware that the govt, through its various press releases in 2008 and 2011, has emphasized and again that its decision in the post with regards to spectrum pricing and allocation procedures have been guided by the TRAI reccomendation of 2007. this position has been publcly reiterated by several past and existing Telecom Ministers, the Hon’ble Prime Minister, Deputy Chairman Planning Commision and the current minister of Law and Justice. It would, therefore, be a logical conclution that the same expertise of the TRAI which was being cited as the reasons for earlier decisions (January 2010) be upheld especially since on this occasion, the TRAI seems to have done lot more specific and focuse work in responding to the government’s reference / Hon’ble Supreme Court’s direction.
- Any attempt to significantly alter the reccomendations made by the TRAI without detailed and proper justification will certainly be open to ligitation, espically since the reserve price is an integral part of the forthcoming 2G Spectrum auctions which have been directed by the Hon’ble Supreme Court itself. Unless Valid, detailed and transparent reasoning is provided for deviating from TRAI’s reccomendation, any decision of the government will find it difficult to dodge juditial scrutiny.
- The TRAI has received the reference twice over on the issue of reverse Price. It has not only strengthened its reply during its responce to the re-reference, but has in fact, discarded all apprehensions by service providers relating to the hike in tarrifs. These have been done in a methodological and scientific manner. changing these would require the exact same rigour of approach. It is hoped that the EGoM will keep in mind the enormous and high quality work that has already gone into making such detailed reccomendations.
- The reccomendations on reserve price by the TRAI takes into Concideration scientific factors and properties of spectrum, market economics, impact on local call tarrifs, previous benchmarks, affordability and financial situations of the telecom companies. in effect, it combines multiple expertise before the statutory reccomendation was made. reversing or modifying the same requires the exact same expertise which is virtually impossible to collect at one place in a short period of time.
- Finally the authority of the regulator, TRAI has been eroded considerably over the last 10 – 12 years. this is TRAI’s attempt to regain its credibility by first submitting a well-argued and detailed position on reserve price, and later defending it without succumbing to political pressure or corporate lobbying. upholding TRAI’s statutary reccomendations – unless the EGoM can point to any significant flows in the workings submitted by TRAI – would be the right an d proper things to do.
I am sure that the EGoM is being ably assisted by some of the best minds on this issue, and equally, that the EGoM is acutely aware of the need to bring certainly into the telecom sector based on respecting the work of a statutory authority.