Sunday, October 30, 2011

Policies For The Corporates And Against The People


The UPA-II Government is now releasing Policies/Draft Policies one after another. Following are some of these policies:
1.      Draft National Competition Policy 2011
2.      National Manufacture Policy 2011
3.      Draft national Telecom Policy 2011
Etc.,
The aim of the Draft National Competition Policy is to destabilize the PSUs in the name of treating PSUs and Private Companies equally, without “discrimination” and to create “level playing ground” between them. The policy says there should not be any discrimination between domestic and overseas enterprises. This means Government will not encourage PSUs and also will not encourage domestic manufacture in the name of encouraging competition.
The national Manufacturing Policy is meant for granting all sorts of concessions in land acquisition, infrastructure provision, taxes etc to the domestic and overseas corporate and at the same time exemption to them from the implementation of labour laws so that they can make workers as bonded labor.
The Draft National Telecom Policy is aimed at making the past scams in telecom sector as present policy and encouraging the private operators at the cost of the PSUs and handing over telecom sector to the full control of foreign investers and thus leading to serious threat to national security.
The Prime Minister Manmohan Singh says that reforms are further needed and are to be implemented in fast manner. Reforms mean looting the coffers of the Government for granting more and more concessions to domestic and foreign corporate and imposing more and more burdens on the people.
In USA such policies resulted in severe unemployment and reduction in income for the common people and a serious struggle started in the name of “Occupy Wall Street” movement against such “reforms” , initially near Wall Street(The Head Quarters of big corporate in America) in New York and it spread to all cities in America and also to several other countries. In Europe such policies resulted in the Governments becoming bankrupt with heavy debt and imposing austerity measures on workers and people, like retrenchment, wage cut, pension cut etc and in several countries struggles are going on against these policies.
Inspite of this, the UPA Government and the NJP Governments in the States are going ahead with such bankrupt policies. The working class and the people are fighting against these policies. On 8th November 2011 all the central trade unions including INTUC are organizing Jail Bharo/Satyagraha/Dharna against these policies. On 15th November the JAC of BSNL employees and Officers is organizing one day strike against the proposal for mass scale retrenchment in the name of VRS and for saving BSNL. On 25th November 2011 the Central Government/State Government/BSNL employees are organizing March to Parliament demanding withdrawal of the PFRDA bill (Pension Fund Regulatory and Development Authority bill) aimed at privatizing pension payment.
There is no other alternative available to the working class and the people except to organize serious struggles for bringing positive changes in the policies of the Governments, either in India or in America or in Europe.



Saturday, October 29, 2011

Indian Telecom Sector Facing Stagnation and Staff Cuts On The Anvil In Several Companies


Following are the important points in the report given by “The Economic Times” dated 29-10-2011 in the news item with the caption “India’s Telecom Story Over? Six Top Executives Of Mobile Companies Hunting For New Jobs”:
i)                    Industry revenues have not gone up in two years.
ii)                  Funds have dried up
iii)                Expansion is on hold
iv)                Profits and customer additions have slowed
v)                  The 14-player industry battles to recover from the fallout of the 2G spectrum scam.
vi)                Most companies are battling high debt and stagnant revenues.
vii)              Banks have refused to lend.
viii)            3G is making very slow progress.
ix)                Many top executives are looking at changing sectors.
x)                   Instead of managing growth, expansion and rolling out new service offerings, most chief executives are confronted with reducing head count, restructuring exercises, merging verticals and businesses.
xi)                Most of the companies that received their licences during the tenure of the former telecom minister A Raja have put their expansion plans on hold as they are battling high debt and also face the possibility of the Supreme Court cancelling their permits.
xii)                According to data compiled by sector regulator Trai, new entrants, with the exception of Unitech Wireless are also facing an exodus of customers as operators' reduce their ultra-low tariff plans and free minutes.
xiii)            Some of these operators are also awaiting an exit policy that would enable them to surrender their permits.  
xiv)            Over the last couple of months, several leading telcos, including Bharti Airtel, Tata Teleservices, Reliance Communications and Aircel, have undertaken major restructuring exercises while Vodafone and Idea Cellular are expected to follow suit.
Bharti Airtel's move to collapse its various business verticals is likely to trigger a large-scale job cull that will make about 2,000 executives redundant. Tata Teleservices has combined its GSM and CDMA business divisions, a move that may make about 15% of those employed by the company redundant. Last month, Reliance Communications had merged its three business divisions, forcing the company to hand out pink slips to about 700 employees and 'redeploy' another 2,000 executives to 'field functions'.
While this report of the Economic Times covers private sector only, the situation in Public Sector is more serious. BSNL and MTNL are in losses since 2 years and the loss increase considerably. Both have proposed large scale VRS to reduce staff strength by one third. Since they have no cash reserve, they are requesting the Government to fund the expenditure for VRS. BSNL is requesting the Government to sanction Rs 11000 crore as grant or equity to make the additional payment to one lakh employees supposed to take VRS. But this Rs 11000 crores is for exgratia with 35/25 days formula and if it is 60 days formula, the amount required will be Rs 18000 crores. Government is already in financial difficulties since its revenue does not increase as per its expectation and it is not in a position even to provide required funds for MNREGA and other social sector programmes. Therefore Government is not in a position to provide the fund. As per the DPE guidelines, VRS has to be funded by loss making PSUs by taking loan from Banks. It is to be noted that the Banks are not lending to the Private Sector Companies. But they may be willing to grant loan to BSNL since it is a Government Company with large scale valuable assets. If BSNL takes such a huge amount as loan to fund VRS, it will increase its financial difficulties much more and it will threaten the future of the BSNL and its employees (in service or retired).
To help the private operators and to further destabilize the BSNL and MTNL, the Government proposed a “National Telecom Policy 2011” and released its draft on 10-10-2011 inviting comments from the public. Such a policy encouraging the greed of the private operators will not help in the healthy growth of telecom sector. Unless there is a radical change in the Policy for strengthening the Public Sector and controlling the greed of the private sector, there cannot be any meaningful growth in telecom sector.



Monday, October 17, 2011

The Draft National Telecom Policy, 2011-Analysis and proposals for modification


( I made some study on the Draft  National Telecom Policy 2011 released by the Communications Minister Sri Kapil Sibal on 10-10-2011. My analysis of the policy and my suggestions for modifying the policy are given below for information and comments---P.Asokababu)
Public Good and the greed of the Capital
Telecommunication is a public good and the question to be decided for formulating any policy is whether this public good should be left out simply to the profit greed of the capital or whether there should be a strong public sector to serve the interest of this public good.
NTP 2011 on the role of the PSUs in telecom sector
The Draft National Telecom Policy 2011 released by the Communication Minister Sri Kapil Sibal half heartedly recognizes the important role  of the public sector in telecom sector. In the preamble, the Policy says, “The PSUs have played a pre-eminent role in provision of telecom services in the country,  particularly in rural, remote, backward and hilly areas. Contribution of BSNL and MTNL to broadband penetration in the country is significant. The importance of PSUs in meeting the strategic and security needs of the country can also not be understated. This policy recognises that these PSUs will continue to play such important role”.
No  support to PSUs
But the Public Sector is not in a vacuum. It is facing serious competition from the private sector that is not having any social responsibility. It is therefore clear that unless the Government gives a strong policy support, the Public Sector cannot survive. But the policy announces no such support. It says that its objective is “to encourage recognition and creation of synergistic alliance of public sector and other organisations of Department of Telecommunications (DoT) through appropriate policy interventions and support for optimum utilisation of their resources and strengths in building a robust and secure telecom and information infrastructure of the country” . The strategy to achieve this objective is  “ to encourage Public Sector Units under the DoT to identify and exploit strategic and operational synergies so that they play a significant role in service provision, infrastructure creation, and manufacturing” and “ to exploit individual strengths of organisations under DoT/DIT to their mutual benefit for ensuring these organisations to effectively flourish in the competitive  telecom market while adequately supporting the security needs of the country. Efforts will be made for according preferential treatment for procurement of products and services rendered by individual organisations”.
 Thus there will be no compensation from the Government for the losses incurred by the PSUs for meeting the social obligations. The Government will only evolve policies for better co-ordination and co-operation between the PSUs in telecom sector and IT sector for optimal utilisation of their strengths. This means the C-DoT will handle product development, the ITI will manufacture the product and BSNL/MTNL will buy the manufactured equipment from ITI. There can be better co-operation between BSNL and MTNL in extending services since they are operating in exclusive areas. The TCIL, BSNL and MTNL can collaborate for operating telecom services in other countries. Therefore what the policy says to PSUs in telecom sector is that the Government will not extend any support to them and it will only help for establishing better co-ordination between them. But what is the meaning of better co-operation and exploiting synergies when all of them (BSNL/MTNL and ITI etc) are facing losses due to lack of support from Government and the R&D organisation C-DoT almost defunct?
Therefore the intention of the Government is not to give any special consideration to the PSUs in spite of their important role in extending the telecommunications as a public good.
Importance given to Private Sector
On the other hand the policy gives special consideration towards the private sector. It “recognizes the predominant role of the private sector in this field and the consequent policy imperative of ensuring continued viability of service providers in a competitive environment.” Therefore the intention of the policy is to make the private sector viable, in spite of the competition. And it made several proposals to make the private sector viable in spite of its irresponsibility and recklessness.
Licensing and convergence
a)      The policy recognises the necessity of “Unified Licenses” for providing converged services/networks in view of the developments in telecom technologies.

b)      The convergence means (a) convergence of services-providing voice, data, video, internet telephony(till now allowed from PC to PC, and now the policy proposes to allow it from phone to net and net to phone), value added services, and broadcasting services(TV, Radio) by the same line--wire or wireless. (b) convergence of networks-access net work, carriage network(NLD/ILD) and broadcast network—all these networks converging together to provide services without any break, whether at home or at office or roaming and (c) convergence of devices i.e telephone, personal computer, television, radio, inter operable set top boxes and other devices


c)       In view of this convergence, the  license system should be “Unified License Regime” and technology neutral (i.e the licensee can utilise any or all of the technologies).

d)      Instead of the present circle based licenses, the new licenses will be All India based and the network licenses will be separated from service delivery licenses i.e there will be (a) Network Services Operators(NSOs) and (b) Service Delivery Operators(SDOs)


e)      The existing licensees have to migrate to this new regime.

Mergers, Acquisitions, Exits, and sharing of the network
a)      A policy on mergers and acquisitions and exits will be evolved so that the weak operators can exit or get themselves merged with or acquired by the strong operators. This policy has to be framed after consulting TRAI. By such exits, mergers and acquisitions, the weak can get profit by selling their assets and the strong can become stronger by acquiring the weak. In the end in the place of the unlimited competition with 12 to 14 operators in each circle, there will be 5 to 6 operators.
b)      Sharing of the networks--till now only the passive component of the network is allowed to be shared. Now the policy proposes sharing of active component of the network also.
Financial support to Private Sector
The policy proposes to support the private operators by:
a)      Recognition of telecom sector as infrastructure for both wire line and wireless and extension of the benefits available to infrastructure sectors to telecom sector also.
The recognition of telecom as an infrastructure sector would allow operators to enjoy 100 percent tax exemption for 10 years. Currently, telecom operators get tax benefits allowing 100 percent tax exemption for five years and exemption on 30 percent of profits for another five years.
b)       Creation of a special purpose Telecom Finance Corporation as a vehicle to mobilize and channelize financing for telecom operators
c)       Inclusion of telecom sector projects within the ambit of financing from existing entities such as India Infrastructure Finance Company Limited(IIFCL)
d)      Rationalizing (reducing) taxes and levies affecting the sector and work towards providing a stable fiscal regime to stimulate investments and making services more affordable.
But how the private operators like Bharti Airtel, Vodafone, Idea etc can be given such benefit since they already started their operations more than 10 years ago? It is to be noted that these operators already got several benefits like exemption from payment of large amount of license fee to revenue sharing, large amount of spectrum at very low cost, allowing them to start mobile services without allowing DoT/BSNL to start those services until 2002 etc. They got benefitted by violating the tender condition of fulfilling rural network roll out.  The new entrants were allotted 2G spectrum in a corrupt manner at 2001 rates. Therefore there is no necessity to give such exemptions and incentives to the private operators unless they encourage domestic production and self reliance.

Oligopoly and collaboration to exploit users
The policy thus aims at creating 5 or 6 big private operators in the place of the present 12 to 14 operators by mergers, acquisitions and exits. These big companies will collaborate among themselves by sharing their networks. There will be no real competition since they will collaborate to exploit users. It was said that to make the market really competitive, there should be more than 10 operators and having only 5 or 6 operators is no competition at all. Thus instead of competition, there will be oligopoly with collaboration. This sharing of networks is allowed in the name of “optimizing the investments”. This means installing parallel networks by several operators is a  waste of capital and hence they can share their networks. For example  Instead of each operator erecting a tower in a village, they can share a single tower. But in such case it will be more saving of the capital in case the entire network in the country is laid down by the same operator and if it is laid down by the incumbent operator BSNL, it will be more cost saving since it is having network throughout India. Thus the very logic proves that in the capital intensive telecom sector it is not economical to have parallel net works for extending services. Even then, the Government wants to favour the big corporate  by encouraging oligopoly and by forgoing its own revenue by granting several concessions to them.
The result of Oligopoly in US
In the US there was a wave of mergers shrinking the number of telephone and cable companies to six, around half of the total number in the mid 1990s. It resulted AT&T, Verizon and Comcast ruling the roost. 18% of the households in US have no more access than a single broadband provider—a monopoly and another 78% of the households has at most two choices for wired broadband access, a duopoly. In the wireless market 4 Companies are dominating. It resulted in higher tariff for the users and the FCC (Federal Communications Commission, equal of our TRAI) acknowledged that there is little meaningful competition between them and they have no incentive to upgrade their networks.  Because of such oligopoly, the US that invented and introduced internet and was close to first in world internet connectivity in 1990s, now ranks between 15 and 20 in most global measures of broadband access, quality of service and cost per mega byte.
Re farming, sharing and trading of spectrum—handing over the scarce resource spectrum to market forces for profits
The 1999 National Telecom Policy had the objective of “achieving efficiency and transparency in spectrum management”. There is utter failure in this regard and the unholy combination of Corporate-politician-bureaucrat resulted in the 2G scam. Granting licenses to 12 to 14 operators in each service area and giving spectrum at the rate prevailed in 2001 resulted in the scarce spectrum distributed in insufficient quantity to the operators.
The average spectrum held by the operator in India is roughly a third of the world average of 18 MHz per operator. As a result there are some operators with more subscribers and less spectrum and there are new entrants who have less subscribers and surplus spectrum. Added to this is the uncertainty created due to the 2G spectrum scam and consequent legal issues. Further,  the requirement of providing voice-data-video services through wireless broadband increased the necessity for providing spectrum in sufficient quantity. Since spectrum is a scarce natural good which cannot be created,  it can only be rearranged and redistributed.

For this the policy proposes that to move existing organisations utilizing spectrum, whether Government or private, to alternative frequency bands or media to make spectrum available for introduction of new technologies. By such re farming, the Policy proposes to make available additional spectrum of 300 MHz for IMT services (International Mobile Telephony) by the year 2017 and another 200 MHz by 2020.  It proposes delinking of spectrum from license to avoid the controversies regarding spectrum allocation and proposes to allot it through market related processes. The policy proposes to allow spectrum sharing (sharing of surplus spectrum with those having shortage) and trading (secondary selling of the spectrum by one operator to another operator).  It proposes a separate Spectrum Act to deal with all the issues related to allocation of spectrum-allotment, withdrawal, re farming, sharing, trading etc in a transparent manner.

Alternative proposal regarding spectrum

But such policy of selling spectrum to private operators dominating the sector always results in imbalances in the spectrum allotment. Trading the spectrum means hoarding the spectrum and then selling it for a higher price. Why the spectrum which is a scarce natural resource be allotted to operators for subsequent trading and sharing, even if it is by auction? This is nothing but leaving the scarce natural resource and public good spectrum at the mercy of the market forces. It should be owned by the Government as a public good and has to be allotted as per real requirement, freely to PSUs and at market rates to private operators. China allotted spectrum to its PSU operators (no private operators in China) without any charge. The distribution of spectrum can be made similar to that of municipal water supply i.e single authority supplying to users as per requirement based on time and place.  The Cognitive Radio Technology is making this feasible.

Broadband, Optic fibre network, rural telephony and universal Service Obligation Fund

a)      Laudable objectives

As per the ICT (Information, Communications Technology) development index prepared by ITU (International Telecom Union of United Nations Organisation) for the year 2008, India ranks at 117th position among 151 countries, and is behind China (79th position), Vietnam (86th position) , Mongolia (96th position), and Srilanka (105th position). Therefore it is necessary to increase telecom and broadband access in a great measure.

The policy lays down the following objectives regarding rural telephony and broadband:

i)                    To recognize telecom and broadband as a basic necessity like education and health and work towards “Right to Broadband”.

ii)                   Increase rural tele-density from the current level of around 35 to 60 by the year 2017 and 100 by the year 2020.


iii)                 Provide affordable and reliable broadband on demand by the year 2015 and to achieve 175 million broadband connections by 2017 ( As on 31-7-2011, only 12.5 million broadband connections are there in India) and 600 million by the year 2020. The policy further aims at revising the existing broadband down load speed of 256 Kbps to 512 Kbps and subsequently to 2 Mbps by 2015 and higher speeds of at least 100 Mbps thereafter.

iv)                 Optical fibre cable will be initially laid up to the village panchayat level by funding from the Universal Service Obligation Fund (USOF). Thereafter it will be progressively extended to all villages and habitats. Access to this Optical Fibre Network will be open and technology neutral.


v)                  To build synergies between existing, on-going and future Government programs viz. E-governance, e-panchayat (Digital Panchayat is about empowering and developing the grassroots communities at the panchayat levels through creation of virtual community at each panchayat level through an interactive and collaborative web portal, the portal run, managed and sustained by the local community through regular information and content management from a bottom-up as well as top-down channels), NREGA, NKN AADHAR, AAKASH tablet (low cost tablet computing device)  etc and roll out of broadband .

b)      Who will own the optic cable network

These objectives are laudable. But who will install and maintain the optic fibre cable network throughout the country ? The policy is not clear on this. It seems the idea is to create a separate organisation jointly owned by the public and private sector together and subsequently to privatize it.  When the network is to be established by funding from USOF and other resources of the Government, why it should be privatized? The funds required can be mobilized from USO Fund and banks or through bonds.  The establishment and maintenance of this network can be done by the incumbent operator BSNL, which is already in the first position in the optic fibre network and it also can be the owner of this new network.  It is not proper to allow private operators to own this net work, since it is “the information super high way, a common good, to be used by all, like Highways. China followed a similar strategy with Government constructing the backbone networks and allowing competition among access networks ,  which are PSUs only. Such a strategy helped in China achieving spectacular results in increasing the broadband connections. By 2011, the number of fixed broadband connections in China reached 13 crores.

c)         Valuable Asset being neglected

As per the TRAI, there are 40 million copper loops available in the country belonging to BSNL throughout the country and to a small extent belonging to MTNL in Delhi and Mumbai. At least 50% of these copper loops can be utilised for extending broadband connection through DSL technology.  86% of the total broadband connections were given by utilising the DSL technology. 56% of the total  broadband connections in India  are given by BSNL by using these copper loops with DSL technology. Thus BSNL is having the capacity to provide a total 2 crore  broadband connections utilising its copper loops and this net work is present  throughout the length and breadth of the country including rural and backward areas. More and more broadband connections can be given by strengthening this local network of BSNL.  But this landline network is neglected by the Government. The losses incurred on the rural  landlines is not compensated by the Government to BSNL. The network has to be maintained as an asset with a long term view in spite of there being no profit possible on it. Due to the pressure from the private operators, the Government stopped payment of this compensation.

d)      Other access for providing broadband connections

Cable TV cables can be digitalized and used as access for providing the broadband connections. Similarly wireless technologies can be utilised. Fibre to Home can be utilised. All these access networks have to be connected to the optic cable backbone through aggregation access network.  By all these accesses, the broadband connections can be increased.

R&D and self reliance in equipment manufacture and national security

a)      Total negation of self reliance and national security-Objectives of National Telecom Policy 1994 and National Telecom Policy 1999 totally neglected and negated

i)                    The bankruptcy of the neo-liberal policies in telecom sector is fully evident in the R&D and indigenous manufacture of telecom equipment.  In  1997 India had   1.75  crores telephone lines (1.7 crore wire line  and 5 lakhs  wireless lines).  It reached to 85  crores  (82crores wireless and 3 crore wireline) on 31-3-2011. The internet services were launched in 1995 and as on 31-3-2011 there were 1.2 crore broadband connections. Inspite of this spectacular growth in services, India lost its self reliance in R&D and equipment manufacture in telecom sector. During the years 2004-05 to 2008-09, equipment costing Rs 309369 crores was utilised for telecom expansion in India and only 11% of this i.e 34031 crores was the value created in India and a huge amount of Rs 2,75,338 crores accrued to foreign manufacturers.  In this Rs 1,24,280 crores was for importing completely knocked down(CKD) equipment, and Rs 150518 crores was for importing semi knocked down (SKD) equipment. There is no improvement in R&D. Rather, it stopped almost.  ITI, the premiere equipment manufacturing PSU has become sick. This happened since the private operators outsourced the installation, maintenance and operation of their networks to the foreign equipment manufacturers and confining themselves only to branding and marketing.

ii)                   This handing over of the networks to foreign companies seriously compromised the national security  and the Home Ministry repeatedly raised several issues in this regard, including the possibility of embedded spyware and malware in the imported equipment. The Government of India issued guidelines in 2010 stipulating that the foreign equipment suppliers   should transfer their technology to Indian manufacturers within three years, they should appoint only Indians while installing, maintaining and operating the networks for the telecom services companies and they should deposit their software source codes in an escrow  account with an independent and trusted third party. But these prescriptions were strongly opposed by the US Government and the American and European telecom equipment manufacturers (The Chinese equipment providers did not oppose these provisions and agreed to deposit their source code in the escrow account).  Calling India’s new telecom security approval process “inflexible and unworkable”, the United States Trade Representative (USTR)  disclosed in its annual compliance report that the Indian government “suspended implementation of several of these conditions” after the US conveyed the concerns of its companies. “The issue came to a head during US President Barrack Obama’s visit. It was said then that a committee of experts would look into these concerns”. Finally the DoT was compelled to issue revised guidelines on 31-5-2011. As per these revised guidelines, the foreign suppliers need not transfer their technology, need not deposit their source code in escrow account, and need not  man the top level posts in the telecom network maintenance with Indians except a few posts like  Chief Technology Officer etc. The telecom service companies have to get their net work audited from the security point of view by a certified agency, call data  of customers must be made available along with the tracking of their location  etc are the revised guidelines.

iii)                 This happened in spite of the prescriptions of the National Telecom Policy 1994 and the National Telecom Policy 1999 prescribing self reliance in equipment manufacture and taking care of national security and development of R&D.  The NTP 1999 mentioned the following objectives:


a)      Strengthen research and development efforts in the country and provide an impetus to build world-class manufacturing capabilities

b)      Achieve efficiency and transparency in spectrum management


c)       Protect the defence & security interests of the country

d)      Enable Indian Telecom Companies to become truly global players.

Of the above objectives, the objective (d) was fulfilled to the extent that the private telecom operators like Bharti Airtel could acquire the telecom networks in African countries and thus became global players. At the same time self reliance, R&D and national security are neglected and compromised. Instead of transparency and efficiency, there is 2G spectrum scam.

Objectives in the National Telecom Policy 2011

The following objectives were mentioned regarding R&D, self reliance and security


a)      Promote indigenous R&D, IPR creation, entrepreneurship, manufacturing , commercializing and deployment of state of art telecom products and services during 12th five year plan(2012-17)  by creating a corpus for this purpose.

b)      Promote domestic production of telecommunication equipment to meet 80% Indian telecom sector demand through domestic manufacturing with a value addition of 65% by 2020.


c)       Provide preferential market access for domestically manufactured telecommunication products including mobile devices, SIM cards with enhanced features etc with special emphasis on Indian products for which IPRs (Intellectual Property Right i.e technology invented by India) reside in India to address strategic and security concerns of the Government, consistent with international commitments.

d)      To ensure security by utilising indigenously manufactured multi functional SIM cards with indigenously designed chips.


e)      To mandate and enforce the telecom service providers to take adequate measures to ensure the security of the communication flowing through their network by adopting contemporary information security standards.

f)       To provide criterion for sharing of costs beyond a threshold limit between Government and the service providers in implementing the security measures.
No concrete plan for attaining these objectives and strategies and for overcoming the hurdles
a)      Indigenous manufacture cannot develop unless there is compulsion on the telecom services operators to procure the equipment manufactured in India. For this the policy prescribes that the telecom operators should prefer to buy Indian products, subject to the condition that it is to be consistent with international commitments. What are the international commitments? The Telecom Industry Association of America wrote to their Government to take up the case with the Indian Government that such preferential access to Indian products is against World Trade Organisation Agreement, since the WTO agreement prevents preferential treatment to domestic products. The relevant part of the WTO agreement is as below:
Para 1. The [Members] recognise that internal taxes and other internalcharges, and laws, regulations and requirements affecting the internal sale,offering for sale, purchase, transportation, distribution or use of products,and internal quantitative regulations requiring the mixture, processing or use of products in specified amounts or proportions, should not be applied  imported or domestic products so as to afford protection to domestic production.
Para 5. No contracting party shall establish or maintain any internalquantitative regulation relating to the mixture, processing or use of products in specified amounts or proportions which requires, directly or indirectly, that any specified amount or proportion of any product which is the subject of the regulation must be supplied from domestic sources. Moreover, no contracting party shall otherwise apply internal quantitative regulations   in a manner contrary to the principles set forth in paragraph 1.”

Therefore the WTO agreement is preventing preferential treatment to domestic products. In such case how this can be overcome for encouraging domestic production is a big question?

These provisions, as per the WTO agreement, will not apply to laws, regulations or requirements governing the procurement by governmental agencies of products purchased for governmental purposes and not with a view to commercial resale or with a view to use in the production of goods for commercial usage .These provisions also do not prevent payment of subsidies exclusively to domestic producers from proceeds of internal taxes or charges.

An interpretation is being made that since the private operators are licensed to operate on behalf of the Government, the procurement of equipment by them is nothing but procurement on behalf of Government and hence they can resort to preferential treatment to Indian Products.

Therefore the Policy makers are not sure about this and hence stated in the policy that such preferential treatment to Indian products will be consistent with international commitments. It is an assurance to the TIA (Telecom Industry Association of America)

In any case it is necessary to overcome all these barriers and encourage domestic production and self reliance.


b)      The NTP 1999 provided  incentives to service providers for utilising indigenous equipment. In spite of this, the private operators did not procure Indian equipment.

c)       There is no plan to have the existing latest technology transferred from the foreign equipment manufacturers so that it can be further improved by indigenous research. Hence the R&D will be restricted to certain areas where India can do on its own.


d)      In the absence of the will power of the Government to compel the foreign equipment manufacturers to transfer their technology and to compel the telecom operators to give preference to procure Indian products, and by restricting the intention of encouraging Indian Products with the rider that it has to be consistent with international commitments, the intended self reliance and security lost its force in spite of the evident determination to move forward to some extent towards this goal.

e)      The policy proposes to subsidize the private operators to some extent for the expenditure incurred by them for implementing the security measures. Providing such subsidy is unwarranted since it is the responsibility of the operators to take care of the security requirements.  

Other points in the Policy
The draft policy pronounced certain  objectives and strategies:
a)      Ensuring the  quality of service and protection of consumer interest
b)       skill development in telecom sector
c)        utilising cloud computing technology increasingly for design and roll out of services and for social networking and participative governance etc, for making India a global leader in the development and provision of cloud services ( Cloud computing means using the Web server facilities of a third party provider on the Internet (the "cloud") to store, deploy and run applications. Cloud computing takes two forms. It may refer to "utility" computing in which only the hardware and software infrastructure (operating system, databases, etc.) are offered, or it may refer to "software as a service" (SaaS), which includes the business applications as well. Regardless whether the cloud is infrastructure only or includes applications, major features are self service, scalability and speed.)
d)      Appropriate policies in the area of enterprice services and data
e)      Encouraging the new technologies like M2M communications (Machene to Machene communications) –e.g. remotely operated irrigation pumps etc
f)       To recognize the importance of the new Internet Protocol IPv6 to start offering new IP based services

Issues of employment with social justice  and workers rights-HR policies
a)      The policy gave certain prescriptions like converting the training centres under DoT i.e the training centres of BSNL, MTNL, ITI etc into national level schools of excellence and collaboration between such national level schools and premier educational institutes like IITs for developing the skills related to telecom sector and to bridge the gap between research/academics and field problems.
b)      But the policy has nothing to say about the employment, social justice and workers rights. Any policy should provide guidance not only for the owners and users but also for the workers and for employment, although these are broader issues not restricted to telecom sector. But each sector should also have policy guidelines on these issues. Otherwise these issues will not be taken care of by anybody.
Proposals for modification
After their entry in the Indian telecom sector, the private operators violated the social responsibility of extending services in the rural and backward areas where ever found not profitable. They handed over the installation, maintenance and operation of their networks to foreign equipment manufacturers without caring for national security. They violated the policy to give preference for procuring Indian made equipment and not encouraged R&D in telecom sector. They were the root cause of the telecom scam in 1999 and the recent 2G spectrum scam. Their greed resulted in so many distortions in the allocation of the scarce natural resource spectrum. They have contributed to the reduction of regular and direct employment in telecom sector. They have not contributed much to the broadband growth since they found that the infrastructure to be laid for it is costly. They want Government support where ever the infrastructure is costly. The claim that the enormous growth in telecom services during the last decade was due to the competition between them was not  the ultimate truth since a much more spectacular growth was achieved in China by the PSUs with the support of the Government and with competition between them.
 The orientation of the draft policy released by the Minister is to support such a private sector at the cost of public sector, self reliance, national security and growth with social justice. This orientation itself has to be changed to have a correct policy. Hence an alternative policy is required with orientation towards public sector, self reliance, national security and growth with social justice.
With this view, the Draft National Telecom Policy 2011 can be agreed/ amended as below (The modifications are given in italics. Otherwise it is to be understood that the proposal in the Draft National Telecom Policy is agreed):







National Telecom Policy-2011

(NTP-2011)

PREAMBLE

1.       Telecommunication has emerged as a key driver of economic and social development in an increasingly knowledge intensive global scenario, in which India needs to play a leadership role. National Telecom Policy-2011 is designed to ensure that India plays this role  effectively and transforms the socio-economic scenario through accelerated equitable and  inclusive economic growth by laying special emphasis on providing affordable and quality  telecommunication services in rural and remote areas.
2.       Thrust of this policy is to underscore the imperative that sustained adoption of technology would offer viable options in overcoming developmental challenges in education, health, employment generation, financial inclusion and much else. NTP-2011 is an initiative to create a conducive policy framework to address these issues and to touch  lives of all citizens and transform India. By formulating a clear policy regime, NTP-2011endeavors to create an investor friendly environment for attracting additional investments in the sector apart from generating manifold employment opportunities in various segments of the sector. In achieving the goals of National Telecom Policy 2011 revenue generation will play a secondary role.
3.       NTP-2011 has the vision Broadband on Demand and envisages leveraging telecom infrastructure to enable all citizens and businesses, both in rural and urban landscape, to Participate in the Internet and web economy thereby ensuring equitable and inclusive development across the nation. It provides the enabling framework for enhancing India’s Competitiveness in all spheres of the economy. NTP-2011 envisages support to platform neutral services in e-governance and m-governance in key social sectors such as health, education and agriculture that are at present limited to a few organizations in isolated pockets. This will expand the footprint of these services and thus foster an atmosphere of participative democracy delivery model that is truly citizen-centric.
4.        For the continued growth trajectory of telecom sector, it is crucial to establish appropriate mechanisms to achieve balance between competition and consolidation while dealing with the legacy issues in the sector, thus benefiting both the users and providers of telecommunication services.
(This is to be modified as below:
For the continued growth trajectory of telecom sector, it is crucial to recognise the key role of the public sector and to strengthen it and to set right the distortions arisen due to the private sector while dealing with the legacy issues in the sector, thus benefitting both the users and providers of telecommunication services)

5.        It is now imperative to move towards convergence between telecom, broadcast and IT Services, networks, platforms, technologies and overcome the existing segregation of Licensing, registration and regulatory mechanisms in these areas to enhance affordability, increase access, delivery of multiple services and reduce cost. It will be a key enabler of equitable and inclusive growth. The policy aims to address and enable the coordinated action to respond to the dynamic needs resulting from confluence of telecom, broadcasting and IT sectors.

6.       Given the continued predominant role of wireless technologies in delivery of services in  ICT sector, NTP-2011 incorporates framework for increasing the availability of spectrum for  telecom services including triple play services (voice, video and data) for which broadband  is the key driver. This will be facilitated by deployment of services through appropriate  instrumentalities, while safeguarding national interests.


7.       The emerging technology trends in electronics hardware, telecom connectivity and IT will make it possible for millions of citizens to access services electronically in self-service  mode using mobile phones and the Internet or through assisted service points such as  Common Service Centres etc. This vision is made possible through ubiquitous network connectivity of mobile technology, broadband Internet, fiber penetration in all villages, high-technology low-cost affordable devices and software solutions which enable electronic access to service including m-payment. A unique AADHAR based electronic authentication framework would be integral part of providing service to the people. Cloud computing will significantly speed up ability to design and roll out services, enable social networking and participative governance and m-Commerce at scale which were not possible through traditional technology solutions.

8.       A few million service points will be needed to service the population of billion and a quarter. These access points would include devices which will share the common components such as processors, RAM, LCD panels, solid state memories, bio-metric sensors  and cameras etc. Domestic manufacturing capabilities could be leveraged to cater to these  demands.


9.        A concerted effort to boost manufacturing activity is now exigent as robust economic growth in the country is leading to an extraordinarily high demand for electronic products in general and telecom products in particular. NTP-2011 provides a roadmap for India to become a leader in cutting edge, state of the art technologies through R&D and creation and  incorporation of Indian IPRs in global standards. This will require measures for boosting entrepreneurship and creating a major global manufacturing hub for telecommunication equipment to achieve self-sufficiency while squarely addressing security and strategic concerns. At the same time establishment of processes and standards for protection of the  environment will also be required.
(The underlined portion is to be modified as: “This will require measures for assigning the key role to the  Public Sector R&D and manufacturing organisations and boosting the entrepreneurship for creating a major global manufacturing hub for telecommunication equipment to achieve self sufficiency while squarely addressing security and stragic concerns.)

10.   NTP-2011 recognises that the rapid growth in the telecom sector requires to be supported by an enhanced pace of human capital formation and capacity building. It becomes imperative to put in place an integrated skill development strategy for the converged ICT sector as a whole so that there is continuous up-gradation of skills in tune with the technological developments. The cornerstone of this strategy is to derive maximal  dividend from our young population and their creative abilities. The advent of technologies  like cloud computing present a historic opportunity to catapult India’s vaunted service  delivery capabilities to a new level domestically as well globally.

11.    Introduction of new technologies has posed fresh challenges in network security, communication security and communication assistance to law enforcement agencies. NTP- 2011 provides a clear strategy for squarely addressing these concerns.


12.    The PSUs have played a pre-eminent role in provision of telecom services in the country,  particularly in rural, remote, backward and hilly areas. Contribution of BSNL and MTNL to  broadband penetration in the country is significant. The importance of PSUs in meeting the  strategic and security needs of the country can also not be understated. This policy recognises that these PSUs will continue to play such important role.

(The underlined portion is to be modified as : “This policy assigns the key role to these  PSUs in achieving the objectives in the telecom sector”)

13.    NTP-2011 recognises the importance of creation of the robust and resilient telecom networks for adequately addressing the need for proactive support for mitigating disasters, natural and manmade.

14.   NTP-2011 recognises futuristic roles of Internet Protocol Version 6 (IPv 6) and its applications in different sectors of Indian economy.


15.    New Telecom Policy 1999 has been a catalyst for growth of the telecom sector. It has resulted in unprecedented increase in teledensity and sharp decline in tariffs. The important  objectives of NTP-99 included:

(This para may be replaced with: “The important objectives of the New Telecom Policy 1999  were:”

a)      Availability of affordable and effective communications for the citizens,
b)      Provision of universal service to all uncovered areas,
c)        Encourage development of telecommunication facilities in remote, hilly and tribal areas of the country,
d)       Provision of high-level services capable of meeting the needs of the country's economy,
e)      Creating modern and efficient telecommunications infrastructure,
f)       Enabling competitive environment in both urban and rural areas to provide equal opportunities and level playing field for all players,
g)       Achieving efficiency and transparency in spectrum management,
h)      Enabling Indian Telecom Companies to become truly global players

16.    In the last decade Indian telecom sector contributed to the all round fast paced growth of not only knowledge and service sectors, but also of other social sectors. This has also resulted in the development of new business ecosystems. The contribution of the telecom sector to overall GDP grew from 1.5% to 3% during the decade. It has become the third largest sector in attracting FDI inflows, accounting for more than 8% of cumulative FDI inflows during the period. The composition of telecom sector has witnessed a structural change with increased participation of private sectors in providing telecom services.

17.    The key achievements of NTP-99 are: (as on June 2011)

(Replace this with: “The key achievements in the telecom sector are”: (as on June 2011)

a)      Telephone on demand,
b)       Increase in overall teledensity from 2.3 in 2000 to 74.0,
c)        Number of telephone connections increased from 33 million in 2000 to 886 million,
d)      Sharp decline in telephone tariffs to as low as 0.5 paisa per second and STD at about 1 paisa per second,
e)      Increase in Rural teledensity from 0.4 in 1999 to 35.6,
f)       Coverage of 97.6% of the inhabited villages (5,79,421),
g)       High speed data and multimedia capability provided to all towns with a population greater than 2 lakh
18.   Although there has been a rapid rollout of cellular mobile networks with over 886.0 million subscribers as on June 2011, there has been relatively less penetration in rural areas  with only 298.1 million connections. Besides huge gap between rural and urban teledensity,  broadband penetration (approx. 1.0%) has lagged behind the growth of telephony in India  (teledensity of 74.0). The sector related skill development has also been limited. The  contribution of telecom related R&D, IPR creation, design to promote development of products and indigenous manufacturing of telecom equipment has not measured up to the  expectations. Against this backdrop, Government recognises the need to formulate a new telecom policy to bridge the gaps and face the challenges for becoming a world leader.

(In this para, after the words “...has not measured up to the expectations” and before the words “Against this back drop”, add the following:
“ The total dependence on foreign equipment for expanding the network resulted in several security related problems. The concept level playing ground was interpreted to mean removing Government’s support to PSU operators BSNL and MTNL for meeting the social obligations and not giving  any preferential treatment to PSU manufacturing units like ITI etc. The distortion in the allocation of spectrum resulted in several problems for the sector”).  
I. VISION
To provide to the people of India, secure, reliable, affordable and high quality converged telecommunication services anytime, anywhere.
II.  MISSION
1.       To develop a robust, secure state-of-the-art telecommunication network providing  seamless coverage with special focus on rural and remote areas and bridging digital divide.
2.        To create knowledge based society through proliferation of broad band facilities in every part of the country.
3.        Make India a global hub for telecom equipment manufacturing and provisioning of converged communication services.
4.       To promote Research and Development and Product Developments in cutting edge ICTE technologies and services for meeting the domestic security needs and worldwide market.
5.       To promote development of new standards and generation of IPRs to make India a leading nation in the area of telecom standardization, especially among Asia Pacific countries.
III. OBJECTIVES
1.       Provide high quality, affordable and secure telecommunication services to all citizens.

2.       Increase in rural teledensity from the current level of around 35 to 60 by the year 2017 and 100 by the year 2020.


3.       Provide affordable and reliable broadband on demand by the year 2015 and to achieve 175 million broadband connections by the year 2017 and 600 million by the year 2020 at minimum 2 Mbps download speed and making available higher speeds of at least 100 Mbps on demand.

4.       Enable citizens to participate in and contribute to e-governance in key sectors like health, education, banking etc. to ensure equitable and inclusive growth.


5.        Provide high speed and high quality broadband access to all village panchayats through optical fibre by the year 2014 and progressively to all villages and habitations.

6.        Promote indigenous R&D, innovation and manufacturing that serve domestic and foreign markets by addressing market distortions, enhancing market accessibility, making available factors of production, increasing skills and competency in telecom and providing incentives wherever necessary.


7.        Create corpus to promote indigenous R&D, IPR creation, entrepreneurship, manufacturing, commercialising and deployment of state-of-the-art telecom products and services during the 12th five year plan period.

8.        Promote the domestic production of telecommunication equipment to meet 80% Indian telecom sector demand through domestic manufacturing with a value addition of 65% by the year 2020.

9.        Provide preferential market access for domestically manufactured telecommunication products including mobile devices, SIM cards with enhanced features etc. with special emphasis on Indian products for which IPRs reside in India to address strategic and security concerns of the Government, consistent with international commitments.


10.    Develop national standards and contribute to and participate in evolving international standards. This will be supported by establishing appropriate linkages with industry, R&D institutions and academia.

11.   Create licensing framework to ensure flexibility in licensing to further extend converged services. This will not cover content regulation. This will provide high quality converged  services across the country including rural and remote areas.


12.    Strive to create One Nation - One License across services and service areas.

13.   Achieve One Nation - Full Mobile Number Portability and work towards One Nation -  Free Roaming.


14.   To reposition the mobile phone from a mere communication device to an instrument of empowerment that combines communication with proof of identity, fully secure financial and other transaction capability, multi-lingual services and a whole range of other capabilities that ride on them and transcend the literacy barrier.

15.   To encourage development of mobile phones based on open platform standards and capable of supporting multi lingual services for enabling secure and authenticated online transactions.


16.    Deliver seamless voice, data, multimedia and broadcasting services on converged networks for enhanced service delivery to provide superior experience to users.

17.   Facilitate consolidation in the converged telecom service sector while ensuring sufficient competition.


18.   Optimize transmission of services to consumers irrespective of their devices or locations  by Fixed-Mobile Convergence thus making available valuable spectrum for other  wireless services.

19.   Promote an ecosystem for participants in VAS industry value chain to make India a global hub for Value Added Services (VAS).

20.   Ensure adequate availability of spectrum and its allocation in a transparent manner through market related processes. Make available additional 300 MHz spectrum for IMT services by the year 2017 and another 200 MHz by 2020.

 ( Modify as below:
Ensure adequate availability of spectrum and its allocation in a transparent manner through market related processes for the private sector and free of cost for the public sector. Make available additional 300 MHz spectrum for IMT services by the year 2017 and another 200 Mhz by 2020)


21.   Promote efficient use of spectrum with provision of regular audit of spectrum usage.

22.   De-licensing additional frequency bands for public utility services.


23.    Recognize telecom as Infrastructure Sector to realize true potential of ICT for development.

24.   Address the Right of Way (RoW) issues in setting up of telecom infrastructure.


25.   Mandate an ecosystem to ensure setting up of a common platform for interconnection of various networks for providing non-exclusive and non-discriminatory access.

26.   Strengthen the framework to address the environmental and health related concerns pertaining to the telecom sector.


27.    Encourage adoption of green policy in telecom and incentivize use of renewable resources for sustainability.

28.    Protect consumer interest by promoting informed consent, transparency and accountability in quality of service, tariff, usage etc.


29.   Strengthen the grievance redressal mechanisms to provide timely and effective resolution.

30.   Strengthen the institutional framework to enhance the pace of human capital formation and capacity building by assessing and addressing educational and training needs of the sector.


31.    Encourage recognition and creation of synergistic alliance of public sector and other organisations of Department of Telecommunications (DoT) through appropriate policy interventions and support for optimum utilisation of their resources and strengths in building a robust and secure telecom and information infrastructure of the country.

(Substitute this para with the following:

“To ensure key role to the public sector units in R&D, Production and Service sectors  of the telecom sector by ensuring full support in all aspects and creation of synergistic alliance of public sector and other organisations of Department of Telecommunications (DoT) through appropriate policy interventions and support for optimum utilisation of their resources and strengths in building a robust and secure telecom and information infrastructure of the country”)

32.    Evolve a framework for financing the sector and streamlining taxes and levies for long term sustainability of telecom sector.

33.    Facilitate access to the financial resources on favourable terms and fiscal incentives required by indigenous manufacturers of telecom products and R&D institutions.


34.    Achieve substantial transition to new Internet Protocol (IPv 6) in the country in a phased and time bound manner by 2020 and encourage an ecosystem for provision of a significantly large bouquet of services on IP platform.

35.    Strengthen the institutional, legal, and regulatory framework and re-engineer processes to bring in more efficiency, timely decision making and transparency.


36.   Put in place a web based, real time e-governance solution to support online submission of applications for all services of DoT and issuance of licences and clearances from DoT.

IV.  STRATEGIES

1. BROADBAND, RURAL TELEPHONY AND UNIVERSAL SERVICE OBLIGATION FUND (USOF)

1.1.  To develop an eco-system for broadband in close coordination with stakeholder ministries to  ensure availability of media for last mile access, aggregation layer, core network of adequate capacity, cost effective Customer Premise Equipment and environment for development of relevant applications. Regulatory policies to promote competition by encouraging service providers, whether large or small, to provide value added services under equitable and non-discriminatory conditions.

1.2. To recognise telecom and broadband connectivity as a basic necessity like education and
health and work towards ‘Right to Broadband’.

1.3. To lay special emphasis on providing reliable and affordable broadband access to  rural and remote areas by appropriate combination of optical fibre, wireless and  other technologies. Optical fibre network will be initially laid up to the village  panchayat level by funding from the Universal Service Obligation Fund (USOF).  Extension of optical fibre connectivity from village panchayats progressively to all villages and habitations. Access to this Optical Fibre Network will be open and  technology neutral.

( Add the following to this para:
The optical fibre cable net work will be laid down, owned and maintained by BSNL and MTNL in their respective areas and the funds will be provided from USOF as well as floating of the bonds by the Government”.)

1.4. To revise the existing broadband download speed of 256 Kbps to 512 Kbps and subsequently
to 2 Mbps by 2015 and higher speeds of atleast 100 Mbps  thereafter.


1.5.  To encourage Fibre To The Home (FTTH) by independent Infrastructure Providers  (IPs) with enabling guidelines and policies, favouring fast transformation of cities and towns into Always Connected society.

(This is to be substituted with the following:
“To encourage Fibre to Home (FTTH) by BSNL/MTNL with enabling guidelines and policies, favouring fast transformation of cities and towns into Always Connected Society”)

1.6. To incorporate enabling provisions in the current regulatory framework so that existing infrastructure including cable TV networks are optimally utilised for extending high quality broadband services in rural areas also.

(As per TRAI, the digitalisation of Cable TV network to enable it to provide broadband  will cost Rs 30000 to Rs 60,000 crores and it recommended enhancement of FDI limit from 49% to 74% for all MSOs (Multiple System Operators) operating at National and State level. This will lead to Mergers and acquisitions in the Cable and dish TV sector. Therefore how to prevent this and at the same time utilise the TV cables for Broadband is the question to be answered. I think there should be provision to ensure that there is competition at least between more than 10 Cable ISPs and the FDI limit should remain at 49%)

1.7. To establish appropriate institutional framework to coordinate with different government departments/agencies for laying of Optical Fibre Cable networks for rapid expansion of broadband in the country.

1.8. To encourage indigenous manufacture of cost effective customer end terminals and devices including mobile devices, SIM cards with enhanced features etc.

1.9. To build synergies between existing, on-going and future Government programs viz e- governance, e-panchayat, NREGA, NKN AADHAR, AAKASH tablet etc. and roll-out of broadband.
1.10.To ensure the availability of sufficient microwave spectrum to meet current and future demand for wireless backhaul especially in prime bands below 12 GHz, in addition to higher spectrum bands. Unlicensed spectrum will be made available for proliferation of wireless broadband services
1.11. To stimulate the demand of broadband applications and services, work closely with Department of IT in the promotion of content creation particularly in vernacular languages which would enhance the investment in All-Internet Protocol (IP) networks including NGN.
1.12. To take steps to minimize the cost per site in rural areas. The use of low power and renewable energy solutions will be promoted to reduce the operational costs and achieve sustainability in the long run.
1.13. To undertake periodic review of methodology adopted for utilising USO fund and benchmarking the same against the best practices followed in other countries.
1.14. To provide continued support from USO fund for converged communication  services in commercially unviable rural and remote areas.
(1.13 and 1.14 be substituted with: To provide continued support to BSNL from USO Fund for the existing as well as converged services in commercially unviable rural and remote areas  )

2. R&D, MANUFACTURING AND STANDARDIZATION TELECOMMUNICATION  EQUIPMENT
                                      
2.1. To spur the domestic telecom equipment manufacturing segment to meet the  indigenous demands for becoming self-reliant in telecom/ICT equipment design and manufacturing. The domestic demand is estimated to be of the order of Rs.2,50,000 crore by the end of 12th five year Plan.
(Add: “The PSUs in telecom equipment manufacture sector including the Telecom Factories under BSNL will be strengthened and given a leading role )

2.2. To ensure focused indigenous development in the telecom sector, efforts would be  concentrated towards a definite policy direction by creating a suitable road-map to align technology, demand, standards and regulations, after considered evaluation of candidate technologies and the emerging trends.
(Add: “Policy for acquiring the existing best technology by transfer from other countries for subsequent Research and Development in India will be formulated”)
2.3. To set up a council consisting of experts from Telecom Service Providers, Telecom Manufacturing Industry, Government, Academia and R&D institutions. The council will
(Substitute this with: “ To set up a council consisting of experts from Telecom Service providers, Telecom Manufacturing Industry, Government, Academia and R&D institutions with majority of them from PSUs/Government sector. The Council will”)

2.3.1. Carry out technology and product development forecast.
2.3.2. Evolve, and periodically update the national program for technology/product development.
2.3.3. Be a nodal group to monitor and ensure the implementation of various recommendations made for promoting indigenous R&D, IPR creation, and manufacturing and deployment of products and services.
2.4. To promote synergy of academia, R&D centres, manufacturers, service providers, and other stakeholders for achieving collaboration and reorientation of their efforts for creation of IPRs, development and deployment of new products and services suited to Indian environment.

2.5. To harness India’s entrepreneurial energy and intellectual capital for the cause of R&D and manufacturing.
2.6. To encourage the young entrepreneurs by making available needed funding (pre-venture and venture capital), management and mentoring support.

2.7. To assist entrepreneurs to develop and commercialize Indian products.

2.8. To strengthen the links in the complete value chain from basic research to IPR generation, product design and development, product commercialization, and simultaneously achieving economies of scale, thereby enabling the product to compete internationally.

2.9. To create fund to promote indigenous R&D, IPR creation, entrepreneurship, manufacturing, commercialising and deployment of state-of-the-art telecom products and services. Emphasis will be given to creation of Indian IPRs which go into international standards as well as in product manufacturing in implementation of major programs and projects as a vehicle to develop Brand India.
(Add: “The R&D institutes and other organisations in Public Sector will be given the lead role in this regard”)

2.10. To promote setting up of Telecommunications Standard Development Organisation (TSDO) as an autonomous body with strong participation of the industry, R&D centres, service providers, and academia to drive consensus regarding national requirements. It will facilitate access for the Indian Industry in the International Standards Development Organisations and act as an advisory body for incorporation of Indian requirement/IPRs/standards in the international standards.
 (Add: The majority of the members of this body will be from Public Sector”)

2.11. To provide preferential market access for domestically manufactured products with special emphasis on Indian products for which IPRs reside in India to adequately address the strategic and security needs of the country consistent with international commitments.
(Add: “The share of the domestically manufactured equipment shall be increased in phased manner so that   80% of the Indian telecom sector demand is through domestic manufacturing with a value addition of 65% by the year 2020. In case the WTO provisions are a hurdle for such encouragement to domestic products, the private operators be nationalized since the WTO provisions will not apply to the procurement by Government organizations”).


2.12. To incentivize telecom service providers to use indigenous products by encouraging:

2.12.1. Commitment to purchase Indian products that are comparable in price and performance to imported products.

2.12.2. Commitment to participate in trials of newly created Indian products, nurture them and place pilot orders.

2.12.3. Funding R&D and support Indian IPR creation and participate in creation of  standards

2.13. To support Electronic Design and Manufacturing Clusters for design, development and manufacture of telecommunication equipment.

2.14. To mandate testing and certification of all telecom products for conformance, performance, interoperability, health, safety, security, EMF/EMI/EMC, etc. to ensure safe-to-connect and seamless functioning in the existing and future networks.

2.15. To create suitable testing infrastructure not only for carrying out conformance testing and certification, but also to aid in development of new products and services. These state-of-the-art labs/infrastructure would be suitably positioned in vicinity of strong R&D clusters and academic institutions and make them available to engineering/academic institutions to assist the scholars in real time telecom product development.

2.16. To actively incentivize export of telecom equipment and services. Synergies among the various telecom players (manufacturers and service providers) would be leveraged to provide integrated communication solutions for exports.

2.17. To facilitate soft credit to the Indian product manufacturers for domestic deployment and exports.


3. LICENSING, CONVERGENCE AND VALUE ADDED SERVICES

3.1. To orient, review and harmonise the legal, regulatory and licensing framework in a time bound manner to enable seamless delivery of converged services in technology neutral environment. Convergence would cover:

3.1.1. Convergence of services i.e. convergence of voice, data, video, Internet telephony (VoIP), value added services and broadcasting services
3.1.2. Convergence of networks i.e. convergence of access network, carriage network (NLD/ ILD) and broadcast network
3.1.3. Convergence of devices i.e. telephone, Personal Computer, Television, Radio,  inter-operable set top boxes and other connected devices.

3.2. To move towards Unified Licence regime in order to exploit the attendant benefits of convergence, for which there is already an in-principle acceptance. A migration path will also have to be provided for existing licensees to Unified Licence Regime.

3.3. To encourage digitalisation of the local cable networks.

3.4. To establish new licensing regime taking care of the requirements of level playing field, rollout obligations, policy on merger & acquisition and non-discriminatory interconnection while ensuring adequate competition.
(Substitute with: “To establish new licensing regime taking care of the requirements of level playing along with the requirement of supporting PSUs as instruments for fulfilling social obligations and strategic and security requirements, roll out obligations, policy on merger & acquisition taking care of the necessity to prevent the acquiring of license and spectrum as a trade and also ensuring adequate competition between at least ten operators since any thing less is oligopoly”)
3.5. To promote introduction of area specific services and applications.

3.6. To allow sharing of Networks and delink the licensing of Networks from the delivery of Service to the end users to facilitate faster roll out of services across the country , enhance the quality of service, optimize the investment and address the issue of the digital divide. This will also facilitate increased competition in the telecom sector without putting any entry barrier in setting up of networks by new operators and at the same time allowing the existing operators to increase their network utilization by sharing the network facilities
(Substitute as below:
“To facilitate faster roll out of services across the country and to enhance the quality of services and to optimize the investment and address the issue of digital divide, the sharing of the networks will be allowed subject to the condition that it should not result in collaboration for exploiting the users. The licensing will enable for providing both the network and services deliver to the end user or any one of them. It will facilitate competition in telecom sector without putting any entry barrier in setting up of networks by new operators and at the same time allowing the existing operators to increase their net work utilisation by sharing the network facilities. There will be no disinvestment in PSUs and the ceiling limits of FDI will not be increased beyond the existing levels”)
 3.7. The technology neutral Unified Licenses are envisaged to be in two separate categories:
3.7.1. Network Service Operator (NSO)/ Communication Network Service Operator
(CNSO)
3.7.2. Service Delivery Operator (SDO)/ Communication Service Delivery Operator
(CSDO)
3.8. Network Service Operator (NSO) would be licensed to set up and maintain  converged networks capable of delivering various types of services e.g. Voice, Data, Video, broadcast, IPTV, VAS etc. in a non-exclusive and non-discriminatory manner.
3.9. The Service Delivery Operator (SDO) would be licensed to deliver any/ all services e.g. tele-services (voice, data, video), internet/broadband, broadcast services, IPTV, Value Added Service and content delivery services etc.
( The above provisions at paras 3.7, 3.7.1 and 3.7.2, 3.8 and 3.9  be deleted in view of the amendment proposed for the provision at para 3.6)

3.10. To facilitate resale at service level – both wholesale and retail – especially keeping in mind the need for robust competition at the consumer end while ensuring due compliance with security and other license related obligations.
(Is this required?)
3.11. New Unified licensing regime will provide flexibility to operators to operate any or all segment of services of the total basket of services provided in the scope of licence.
3.12. To provide clear guidelines and terms and conditions for the extension/migration of existing licences.
3.13. To delink spectrum in respect of all future licences. Spectrum shall be made available at price through market related processes.
(Redraft as: “To delink spectrum in all future licenses and in renewal /migration of  existing licenses. Spectrum shall be made available to PSUs ad Goverrnment Organisations frree of cost and at price through market process for private operators”)

3.14. To frame an appropriate Exit Policy for the licencees.


3.15. To put in place an appropriate regulatory framework for delivery of VAS at affordable price, that can fuel growth in entrepreneurship, innovation and provision of region specific content in vernacular languages.

3.16. To put in place a framework to regulate the carriage charges, which are content neutral and based on the bandwidth utilisation. This will also encourage non value added services such as provision of data and information over the mobile platform.

3.17. To endeavour to make available mobile satellite services compliant with security requirements.

3.18. To extend Intra-circle mobile number portability facility on nationwide basis so that the users can retain their mobile number while shifting from one service area to another, irrespective of the service provider.

3.19. To review roaming charges with the ultimate objective of removing the roaming charge across the nation.

3.20. To seek TRAI recommendations for new licensing framework, migration of existing  licensees to new framework, exit policy etc.
(Add the following condition “ Keeping in view of the principle –key role to public sector and avoiding trading in licenses and spectrum in the name of mergers, acquisitions and exits and to ensure adequate competition atleast 10 operators remain with domination by Public Sector operators.”)




4. SPECTRUM MANAGEMENT

4.1. To permit spectrum pooling, sharing and later, trading for optimal and efficient utilisation of spectrum.

(Substitute with: Spectrum is a scarce natural resource and a public good.Therefore it will not be owned by individual organisations for subsequent sharing and trading.  It will be owned by the Government and will be allotted freely to PSUs and Government organisations and as per market rates . The allotment will be based on the requirement  depending on time and place. The Cognitive Radio technology makes such allocation possible)

4.2. To undertake periodic audit of spectrum utilisation to ensure its efficient use.

4.3. To move existing users of spectrum i.e. Government departments, public sector, private sector and telecom service providers to alternative frequency bands or media to make spectrum available for introduction of new technologies.

4.4. To prepare a roadmap for availability of additional spectrum every 5 years.

4.5. To make available adequate globally harmonised spectrum in the bands of 450  MHz, 700 MHz, 1800 MHz, 1910 MHz, 2.1 GHz, 2.3 GHz, 2.5 GHz, 3.5 GHz and bands identified by ITU for commercial mobile services.

4.6. To identify additional frequency bands periodically, for exempting them from licensing requirements for operation of low power devices for public utility services.

4.7. To consider requirement of spectrum in certain frequency bands in small chunks at specified locations for encouraging indigenous development of technologies/ products and their deployment.

4.8. To review the existing geographical unit of allocation of spectrum with a view to identify scope for optimization.

4.9. To promote use of white spaces with low power devices, without causing harmful interference to the licensed applications in specific frequency bands by deployment of Software Defined Radios (SDRs), Cognitive Radios (CRs), etc.

4.10. To make best use of spectrum in line with technological advancement, an appropriate regulatory framework will be established for progressive liberalisation of spectrum utilisation with a view to making spectrum utilisation voice/data/video neutral.

4.11. To Strengthen Wireless Planning & Coordination (WPC) Wing and Wireless Monitoring Organisation (WMO).

4.12. To strengthen Institute of Advanced Radio Spectrum Engineering and Management Studies (IARSEMS) for undertaking policy research in radio spectrum engineering, management/radio monitoring and related aspects.



4.13. To enact a separate Spectrum Act which inter-alia deals with all issues connected with wireless (spectrum) licences and their terms and conditions including re-farming/ withdrawal of allotted spectrum, spectrum pricing, cancellation or revocation of spectrum licence, exemptions on use of spectrum, spectrum sharing, spectrum trading etc.

(Substitute with: “To enact a Spectrum Act considering  the above points “)


5. TELECOM INFRASTRUCTURE/ ROW ISSUES, GREEN TELECOM, CLEAR SKYLINE,  MITIGATION EFFORTS DURING DISASTERS AND EMERGENCIES

5.1. To emphasize the active role of both private sector and Government including the State Governments and Local bodies to enable the growth of telecom infrastructure necessary for meeting the telecommunication demand of the country and leveraging  USOF wherever appropriate.
(Substitute: To emphasize the key role of the Government including State Governments and Local bodies and the supporting role of the private sector in the growth of the telecom infrastructure necessary for meeting the telecommunication demand of the country and compensation from USO Fund and Government to the Public Sector for the losses incurred on social obligations including maintenance of the legacy networks”)

5.2. To work towards recognition of telecom as Infrastructure Sector for both wireline and wireless and extension of the benefits available to infrastructure sectors to telecom sector also, to realize true potential of ICT for development.

5.3. To review and simplify sectoral policy for Right of Way/Installation of Tower for facilitating smooth coordination between the service providers and the State Governments/ local bodies.
5.4 To engage with concerned ministries/ departments like Ministry of Surface Transport, Ministry of Urban Development, Ministry of Power, Ministry of Rural Development, Ministry of Railways, State Governments and local bodies for facilitating development of guidelines for provision of common service ducts for orderly growth of Telecom Infrastructure.
5.5. To mandate for mapping and submission of information of the infrastructure assets on the standards based inter-operable GIS platform by all telecom infrastructure/ service providers to the licensor.
5.6. To review Standing Advisory Committee on Frequency Allocation (SACFA) clearance  process for faster and simplified site clearances.

5.7. To facilitate increased use of alternative sources (Renewable Energy Technologies) of energy for powering telecom networks through active participation of all the stakeholders – the government, the telecom industry and the consumer for green telecommunications. Sector specific schemes and targets for promotion of green technologies will be finalised in consultation with Ministry of New and Renewable Energy (MNRE) and other stakeholders.

5.8. To promote the use of energy efficient equipment and devices in telecom networks and adopt measures for the reduction of carbon footprint in the telecom sector.

5.9. To promote designing and deployment of low power active radio devices.
5.10. To promote use of In-Building Solution (IBS) and Distributed Antenna System (DAS)  and their siting in coordination with Ministry of Urban Development by aligning the National Building Code as well as embedding these critical requirements in the process of developmental planning and finalization of master plans for rural and urban areas in consultation with the State Governments.

5.11. To undertake periodic review of EMF standards that are safe for human beings for mobile towers and mobile devices with reference to international standards.

5.12. To encourage use of innovative methods like camouflaging, landscaping, monopole towers and stealth structures to conform to aesthetic requirements.

5.13. To prescribe sectoral Standard Operating Procedures for effecttive and early  mitigation during disasters and emergencies. To mandate Telecom Service Providers to provide alternative reliable means of communication at the time of disaster by creating appropriate regulatory framework.

5.14. To encourage use of ICTs in prediction, monitoring and early warning of disasters and early dissemination of information.

5.15. To facilitate an institutional framework to establish nationwide Unified Emergency Response Mechanism by providing nationwide single access number for emergency services.

6. QUALITY OF SERVICE AND PROTECTION OF CONSUMER INTEREST

6.1. To identify the performance standards and QoS parameters benchmarked against the best international standards and evolve suitable compliance mechanism in consultation with TRAI. To improve transparency, NTP -2011 recognises the need for formulating a separate Code of Practice for Sales and Marketing.

6.2. To fully support the sector regulator in their efforts to enhance consumer awareness about services, tariffs, and QoS.

6.3. To make mandatory provision for web based full disclosure of area coverage by telecom service providers.

6.4. To undertake legislative measures to bring disputes between telecom consumers and service providers within the jurisdiction of Consumer Forums/ Consumer Protection Act.

7. SECURITY

7.1. To mandate and enforce that the Telecom Service Providers take adequate measures to ensure the security of the communication flowing through their network by adopting contemporary information security standards.
 (Add : To mandate the Telecom Service Providers to stop the outsourcing of the installation, maintenance and operation of their networks/services to foreign companies)

7.2. To provide communication assistance to the Law Enforcement Agencies (LEAs) through regulatory measures in tune with national needs, keeping in view individual privacy and in line with international practices. To develop and deploy a state of the art system for providing assistance to LEAs.

7.3. To create an institutional framework through regulatory measures to ensure that safe-to-connect devices are inducted into the Telecom Network and service providers take measures for ensuring the security of the network and the data/information flowing/stored in it.

7.4. To build national capacity in all areas - specifically security standards, security testing, interception and monitoring capabilities and manufacturing of critical telecom equipment - that impinges on Telecom network security and  communication assistance for law enforcement.

7.5. To ensure security in an increasingly insecure cyber space, indigenously manufactured multi-functional SIM cards with indigenously designed chips incorporating specific laid down standards are considered critical. The whole electronics eco-system for this and other purposes, starting from the wafer fab needs to be built and hence is viewed as a key policy objective and outcome.

7.6. To mandate standards in the areas of functional requirements, safety and security and in all possible building blocks of the communication network i.e. devices, elements, components, physical infrastructure like towers, buildings etc.

7.7. To promote creation of robust, reliable and resilient communication networks.

7.8. To develop a rational criterion for sharing of costs beyond a threshold limit between Government and the service providers in implementing security measures.


8. SKILL DEVELOPMENT AND PUBLIC SECTOR

8.1. To put in place an ecosystem to:

8.1.1. Assess the manpower requirement at different skill and expertise levels by partnering with National Skill Development Council and industry to identify the relevant needs of the sector and prepare a roadmap,

8.1.2. Create an enabling framework in partnership with Ministry of Human Resource Development (MHRD) to periodically upgrade academic curriculum of telecommunication courses, which are aligned with the technological advancements in the sector for meeting the human resource requirement,

8.1.3. Coordinate efforts to meet the demand for human resources in different parts of the telecom eco-system,

8.1.4. To form a high level Apex body (supported by advisory groups comprising representatives from industry, academia, PSUs, etc.) to oversee and to act as guiding and enabling source for all aspects relating to skill development in telecom field.

8.2. To promote and augment training institutes in urban and rural areas to cater to the skill and training needs of telecom sector.

8.3. Training institutes under the Department of Telecommunication and its other organisations will be developed as national level schools of excellence.

8.4. To encourage collaboration with premier educational institutes like IITs and telecom institutes of excellence for bridging the gap between research/ academics and field problems.

8.5. To encourage Public Sector Units under the DoT to identify and exploit strategic and operational synergies so that they play a significant role in service provision,
infrastructure creation, and manufacturing. ( Add: “To compensate the PSUs fully for the losses incurred by them on account of meeting social obligations of providing services in rural/backward/hilly/difficult areas, national security requirements and considerable contribution to employment compared with private sector)

8.6. To exploit individual strengths of organisations under DoT/DIT to their mutual benefit for ensuring these organisations to effectively flourish in the competitive telecom market while adequately supporting the security needs of the country. Efforts will be made for according preferential treatment for procurement of products and services rendered by individual organisations.

9. CLOUD SERVICES

9.1. To recognise that cloud computing will significantly speed up design and roll out of services, enable social networking and participative governance and e-Commerce on a scale which was not possible with traditional technology solutions.

9.2. To take new policy initiatives to ensure rapid expansion of new services and technologies at globally competitive prices by addressing the concerns of cloud users and other stakeholders including specific steps that need to be taken for lowering the cost of service delivery.

9.3. To identify areas where existing regulations may impose unnecessary burden and take consequential remedial steps for propelling India to emerge as a global leader in the development and provision of cloud services to benefit enterprises, consumers and Central and State Governments.


10. TELECOM ENTERPRISE SERVICES, DATA USE NEW TECHNOLOGIES AND IPV 6 COMPLIANT NETWORKS

10.1. To formulate appropriate policies in the area of enterprise services and data to fuel further growth of India‘s ICTE sector and attract large scale investments.

10.2. To undertake a comprehensive review of critical issues such as encryption, security, privacy, interconnection, etc. keeping in view emerging technologies and unique needs of the sector.

10.3. To recognize the role of new technologies in furthering public welfare and enhanced customer choices through affordable access and efficient service delivery. The emergence of new service formats such as Machine-to-Machine (M2M) communications (e.g. remotely operated irrigation pumps, smart grid etc.) represent tremendous opportunities, especially as their roll-out becomes more widespread.

10.4. To adopt best practices to address the issues related to cloud services and M2M for example privacy, network security, law enforcement assistance, inter-operability, preservation of cross- border data flows to promote a global market for India.

10.5. To recognize the importance of the new Internet Protocol IPv6 to start offering new IP based services on the new protocol and to encourage new and innovative IPv6 based applications in different sectors of the economy by enabling participatory approach of all stake holders.

10.6. To establish a dedicated centre of innovation to engage in R & D, specialized training, development of various applications in the field of IPv6. This will also be responsible for support to various policies and standards development processes in close coordination with different international bodies.

11. FINANCING OF TELECOM SECTOR

11.1. To create a special purpose Telecom Finance Corporation as a vehicle to mobilize and channelize financing for telecom projects in order to facilitate investment in the telecom sector.

11.2. To endeavor to include telecom sector projects within the ambit of financing from existing entities such as India Infrastructure Finance Company Limited (IIFCL).

11.3. To rationalize taxes and levies affecting the sector and work towards providing a stable fiscal regime to stimulate investments and making services more affordable.


12. ROLE OF REGULATOR, CHANGES IN LEGISLATION

12.1. To review the TRAI Act with a view to addressing regulatory inadequacies/ impediments in effective discharge of its functions.

12.2. To undertake a comprehensive review of Indian Telegraph Act and its rules and other allied legislations with a view to making them consistent with and in furtherance of the above policy objectives.
Add the following as point 13:
(13. WAGE POLICY , SOCIAL JUSTICE
13.1 The private telecom companies, whether in production sector or in service sector, should implement SC/ST/OBC reservations in employment and contribute for social justice.
13.2 There should be a national wage policy for the entire telecom sector covering both Public Sector and Private Sector and the wages in private sector should be decided on the basis of the wages in the PSUs)
The primary objective of NTP-2011 is maximizing public good by  making available affordable, reliable and secure  telecommunication and broadband services across the entire  country. The main thrust of the Policy is on the multiplier effect  and transformational impact of such services on the overall  economy. It recognizes the role of such services in furthering the  national development agenda while enhancing equity and  inclusiveness. Direct revenue generation would continue to  remain a secondary objective. NTP-2011 also recognizes the  predominant role of the private sector in this field and the  consequent policy imperative of ensuring continued viability of  service providers in a competitive environment. Pursuant to NTP- 2011, these principles would guide decisions needed to strike a  balance between the interests of users/ consumers, service  providers and government revenue.
(Substitute the underlined portion of the above para with: To avoid the past distortions in the telecom sector, the NTP 2011 assigns the key role to the Public Sector and the consequent policy imperative of ensuring its continued viability in a competitive environment. Pursuant to NTP 2011, these principles would guide decisions needed to strike a balance between the interests of users/consumers, service providers and government revenue”)