Pranab Raises A Stink Against Anymore 3G Auction Delays
3G (3rd Generation) which is expected to bring in another telecom revolution in India is still manifestly facing hurdles. After many delays, the auction of 3G spectrum was attired for August-September 2009. Then again it was delayed, and the tentative dates were set at the end of calendar year. Recently, communication minister A Raja said, it might get delayed due to the Christmas holidays, but surely would be done before the end of financial year (March-2010).
Indian Government which is expected to earn anywhere between 25,000 to 30,000 crores is not happy with all the delays. A major part of fiscal deficits can be closed with this earning. Finance minister, Pranab Mukharjee has told A Raja, in a strongly worded letter dated 15th October to ‘quickly resolve all outstanding issues’. He has told, that there cannot be any further slippage and under no circumstances can the auction be pushed over to the next calendar year.
India is the only major telecom market not to have launched 3G. The base price that operators have to pay has been doubled from what was previously mooted. This was thought of to be a hurdle as the world economy was in a major downturn. Sachin Pilot had told Financial times, that he was very confident that the price increase would not deter the operators and the government would receive much more that what was set.
The only hurdle in the process seems to be from the ministry of defense. They want time for testing and security clearance before they vacate the spectrum being used by them. They say they would complete the task by December 2009, and the auction can take place by June 2010.
In response to the letter, it is believed that A Raja has asked the finance minister to intervene and hold a meeting with the defense minister A K Antony. Under the agreement Defense ministry was to hand over 20MHz of spectrum being used for their internal communication. BSNL is building the defense a communication backbone, but the ministry wants to first test this backbone before releasing the older spectrum.
Some telecom CEOs have also complained that the delay is at the behest of some companies which do not want to spend the money on this at a time when they were adding capacities. It can also be noted that Bharati Airtel and Tata Teleservices have been asking for a speedy allocation.
Its now upto the defense ministry to decide when will the Indian subscribers be upgraded to the newer technology. The delay this time is not as clear as in the previous cases, so an early resolution should take place. The Indian customers can expect the 3G being auctioned and implemented very soon.
If you enjoyed this post, make sure you subscribe to our RSS Feed OR Email Alerts!
Leave a Comment and Follow the replies through Post Comment Feed