Minister for Telecommunications and IT Sri Kapil Sibal will hold a Press Conference on Monday (10-10-2011) at 2 p.m to announce the draft of the “New Telecom Policy 2011” seeking comments from the public on it, before finalizing the policy.
The following are likely to be the main points in this new policy, as per the reports in the press:
1. Fresh licenses as well as renewal of old licenses for operating telecom services will be for 10 years instead of the present 20 years.
2. Earlier the license was given bundled with start up spectrum of 4.4 MHz and in the new policy spectrum will be delinked from license and the service providers have to give market based price for the spectrum
(There is pressure from the existing private operators to continue their start up spectrum freely in the renewed license while collecting the fee from new entrants even for start up spectrum)
3. Spectrum sharing (leasing a part of the spectrum to other operators) is likely to be allowed. Spectrum trading (selling a part of the spectrum purchased from the Government, to the other operators) is likely to be allowed.
( It is to be noted that the Government recklessly allotted spectrum to as many as 12-14 operators in each circle and as a result, each operator got less quantity of spectrum and to come out of this crisis, now the Government wants to allow spectrum sharing and trading i.e those operators having spectrum but could not develop their services extensively could share/sell their spectrum. But why they should be allowed to share/sell their spectrum, since there is no such provision in their license?)
4. Encouraging indigenous R&D(Research and Development)
(But it seems there is no stress on technology transfer from the foreign telecom equipment manufacturers to Indian manufacturers and hence it will be difficult to catch up with the world standards in the technology)
5. Encouraging indigenous telecom equipment production with the intellectual property owned by India, by imposing the condition on telecom operators to buy Indian equipment
(The American Telecom Industry lobby and European telecom industry are opposing any preferential treatment to Indian products. What the draft policy will finally say on this issue has to be seen.)
6. Mergers and Acquisitions of telecom services companies to be made easy so that in the place of the present 12 to 13 operators in each circle are reduced to 5 to 6
(This is making it easy for the new entrants to exit since they could not grow and creating advantage to the big private operators)
7. Bringing telecom infrastructure providers under license frame work( those providing optic fibre cable , towers, ducts, bandwidth etc on lease) under the license frame work
8. National Security
(the earlier guidelines issued by DoT in the interest of national security were opposed by American and European telecom equipment manufacturers and the DoT was compelled to dilute those guidelines. Even after this, their pressure is continuing. It is to be seen what will be there in the draft policy regarding security, under these circumstances)
- National Broadband Plan
(while DoT is trying to assign a major role to BSNL in this regard, the private operators are opposing it. Therefore what will be there in the NTP draft has to be seen.)
- Sharing of active infra structure
(so far sharing of passive infrastructure only(towers), but in the new policy, besides towers, the active infra structure like antennae and mobile exchanges also can be shared-This is being done in the name of saving the capital costs. If the infrastructure is to be installed and maintained by one or two entities and the operators have to share that infrastructure to provide their services, where is the necessity of allowing so many private operators? The DoT/BSNL with its pan India net work is more suitable to provide the entire infrastructure with more cost effective manner avoiding duplication. This proves that entry of private operators increased the capital expenditure unnecessarily)
- Mobile services permits may be divided into (a) network services providers-providing infrastructure and (b) End user service providers-providing voice, data and broadcast services to the customer.
- To do away with roaming charges-the existing number of circles will be reduced to four or five zones or even the entire country may be treated as one zone.
- Encouraging green telecom i.e utilisation of less energy and less carbon emission in telecom sector by encouraging energy efficient technologies
- Creation of a special purpose Telecom Finance Corporation to mobilise and channelize finance for telecom projects
- One nation-one license across the country(at present the license has to be obtained by the telecom operators circle wise) and to permit sharing of networks
- Inter circle MNP-i.e allowing customer to have the same number in all circles and all operators-not restricted to the same circle
- Rationalise taxes and levies to stimulate investment in teelecom sector
The telecom policy is being decided by the successive Governments, whether Congress or BJP, keeping in view the interest of the Indian big Capitalists in telecom sector and their foreign collaborators. The policies are made and deviated to suit their interest.
The National Telecom Policy 1994 guidelines were made by the then Congress Government to encourage the entry of private companies in telecom sector. While these guidelines helped in their entry, they are dissatisfied with certain conditions in the guidelines. Hence they did not implement these guidelines fully and pressurized the Government to change them. Hence the NDA Government announced “New Telecom Policy 1999” announcing Corporatization of telecom services under DoT and absolving the private telecom services companies from payment of the enormous license fee which they have to pay as per the tender and allowing them to migrate to revenue sharing i.e payment of a certain percentage of their revenue every year as License Fees.
While the guidelines suitable to the requirement of private operators were implemented, the guidelines which were against them were violated. Though the NTP 1994 and NTP 1999 prescribed encouragement to indigenous telecom equipment manufacture, it was not done and almost 90% of the equipment is being imported, since the private telecom operators, for their own reasons, did not want to encourage indigenous industry. Though the NTP 1999 assured to reimburse the license fee to BSNL since it is meeting the requirement of maintaining rural land lines by incurring losses, it was finally abolished due to pressure from private operators. The spectrum allocation guidelines were violated resulting in 2G scam and it is for the benefit of some private operators.
Now the NTP 2011 is being brought out to serve the Indian and foreign big capitalists in telecom sector much more effectively. Its aim is to make it easy for the big private operators to acquire small operators, to allow merger of small operators with big operators, to give concession in taxes to the private operators, to allow sharing of network of one operator by another operator, to abolish existing licensing system for each circle and treating entire country as one unit so that those private operators who did not take license for all the circles can now have the benefit of operating their services throughout the country, to allow spectrum trading business, to provide finance for the private operators etc.
But nowhere in the media there is any news about encouragement proposed in the New Telecom Policy 2011” to the PSU telecom operators BSNL and MTNL or PSU telecom equipment manufacturers ITI, HCL etc.
The NTP 1994 allowed private operators, the NTP 1999 further strengthened the private operators and paved the way for creation of BSNL. While doing so, the NTP 1999 recognised DoT (BSNL subsequently) as the “national service provider having immense rural and social obligations” and further stated that the “Government will reimburse full license fee to the DoT”. But the Government violated this policy, reduced and finally stopped the compensation to BSNL for the losses incurred by it on rural and social obligations and coming under the pressure of Indo-US CEO Forum it adopted several measures resulting in the posting of losses by BSNL since two years.
It is to be noted that the NTP 2011 is not talking about treating BSNL/MTNL as instruments in the hands of the Government to meet its social obligations and security requirements. This means the BSNL and MTNL will be treated like any private operator and it will result in mass scale reduction in employees, shedding of the social obligations like rural landlines etc.
Thus the direction of the NTP 2011 is towards strengthening the privatization process and neglecting the social obligation in the telecom sector. This is not only against BSNL and its employees, it is against the goal of inclusive growth, since the social obligation and security concerns in telecom sector will be left to the mercy of the market forces working for profit.
It is necessary to organize a serious campaign and struggle in order to change this policy so that the PSUs in telecom sector are strengthened in order to meet the social obligations and security concerns effectively with out depending on the blind market forces.
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