The Hindu Business Line : Auctioning best way to allocate spectrum: Raja

New Delhi, Nov. 28 The Communications and IT Minister, Mr A. Raja, has said that he is personally in favour of conducting auctions for 2G mobile services but could not do so due to legal issues.

In a letter written to Mr Rajeev Chandrasekhar, Member of Parliament, the Minister has admitted that auction is the most transparent way to allocate spectrum.

“I am personally in favour of allotment of spectrum through auctioning for ensuring transparency. However due to various legalities involved, it is not possible to auction 2G spectrum. In this connection, I would like to bring to your notice that the existing operators have got spectrum in the past ‘free of cost’ and it may not be tenable under law to auction spectrum as it is discriminatory and capricious. In addition, the Government is under contractual obligation to give initial spectrum to those who got licence in December 2006,” Mr Raja said in the letter.

The letter indicates that though the Government knew that auction was the best way to allocate spectrum, it was not being adopted due to fear of legal repercussions.

However, there is also no other allocation mechanism that is emerging clearly with operators divided on how spectrum should be distributed among various claimants. Some operators have challenged the alternative allocation policy based on enhanced subscriber base. The differences are so sharp that meetings initiated by the Department of Telecom have failed to build a consensus.

While the Ministry of Communications wants to bring in new players by allocating licences on a first come first served basis, existing GSM operators are lobbying hard to get their share of spectrum first before new players are brought in.

According to senior Government sources, officials at the Prime Ministers Office are now trying to thrash out a policy that is acceptable to all. Till then the Communications Ministry has been advised not to issue any more letter of intent to new players. Sources indicated that a committee of secretaries comprising Department of Telecom, PMO and other key ministries had been meeting to evolve a consensus.

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