Back and forth to nowhere

Telecom has been one of the most visible success stories of liberalisation in India. This is borne out by a simple statistic: At the turn of this century, there were hardly four telephones for every 100 people in the country, whereas that ratio is almost 80 per cent. Yet, the same sector is today caught in a regulatory limbo and policy inertia, making it no longer the poster boy of reforms that it undoubtedly was till recently. Take the issue of auctioning of 2G spectrum, which is supposed to be completed before August 31, as per the Supreme Court’s orders. For fixing the base price for the spectrum to be auctioned, an Empowered Group of Ministers (EGoM) was set up initially under Mr Pranab Mukherjee, while he was Finance Minister. But with Mr Mukherjee becoming the ruling Congress-led alliance’s presidential nominee, the Agriculture Minister, Mr Sharad Pawar, was made chairman of the EGoM. But within days of taking charge, Mr Pawar quit the panel, saying that his being linked to one of the companies whose 2G licenses granted in 2008 was quashed by the apex court, could further motivate ‘vested elements” wanting to tarnish his image. It obviously raises questions why did Mr Pawar accept the position in the first place? Moreover, the EGoM is a body created (“empowered”) by the Cabinet to expedite decision-making. Mr Pawar’s resignation from the EGoM, therefore, makes no sense, if he continues to be a member of the Cabinet. After all, under the principle of collective responsibility, he cannot be part of the Cabinet, and yet distance himself from its decisions.

With the EGoM now headless, it remains to be seen where this process of decision-making back and forth between the Department of Telecommunications (DoT) and the other key ministries is heading. The DoT has, in fact, muddied the waters further by suggesting a one-time fee on incumbent operators for the 2G spectrum already held by them. This fee, linked to the prices determined in the upcoming auction of airwaves, is supposed to help create a “level-playing field” for the new players who would be shelling out more for spectrum than what the existing operators had paid. Apart from the dubious logic offered (a level-playing field can only be ensured for a given point of time; granting it across different time periods is akin to asking someone to pay today’s price for property acquired 15 years back), this proposal, if implemented, is bound to open a fresh legal minefield.

All these back-and-forth moves and half-baked proposals, at one level, convey the Government’s lack of seriousness in implementing the Supreme Court’s order, even without any formal defiance. It is time for the Prime Minister, Dr Manmohan Singh, himself to put an end to this uncertainty. There is no better sector than telecom to showcase the gains from reforms for the aam aadmi .

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