The Hindu Business Line : Market forces should have determined price of 2G licences: TRAI

New Delhi, Nov. 28 The Telecom Regulatory Authority of Indian on Friday said that market forces should have determined the price of the 2G mobile licence.

“We have said a mechanism should be evolved for licence giving, which must capture the market price. Since the spectrum was bundled in the licence for 2G therefore it was not feasible to auction 2G spectrum but the licence had to capture the market price of the spectrum,” said Mr Nripendra Misra, Chairman, TRAI.

The Communication and IT Minister, Mr A. Raja, had earlier said he had decided against giving out 2G spectrum through auction on recommendations made by the regulator.

Asked whether DoT bypassed TRAI’s recommendations for pricing the 2G licence, Mr Misra said the Government had not sought the regulator’s views on whether spectrum was to be auctioned or not. The regulator had repeatedly said that its recommendations should not be implemented in a piecemeal manner. It had written several letters to DoT, refuting Government claims that 2G licences were being given on a first-come-first-served basis on the suggestion of TRAI.

Mr Misra pointed out that Section 2.73 of its recommendations of 2007 states: “In today’s dynamism and unprecedented growth of telecom sector, the entry fee determined then (2001) is also not the realistic price for obtaining a licence. Perhaps it needs to be reassessed through a market mechanism.”

He was speaking at the roundtable conference on ‘India Telecom Landscape 2012’, organised by the Confederation of Indian Industry.

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