Back Ground for taking these
decisions
Consequent to
the Supreme Court’s judgment cancelling 122 licenses given to the new telecom
operators in 2008 illegally, the GSM
spectrum given to them in 1800 MHz band has become free. As per the order of
this judgment, the Government is auctioning this spectrum thus become free. The
auction will start on 12-11-2012. The Government decided that the base price in
this auction will be Rs 14000 crore for 5 MHz quantity of spectrum for the
entire 22 circles together. The bidders can bid for any circle/some circles/all
circles.
But the existing
operators have not paid any amount for the spectrum allotted to them before
2001 and only Rs 1650 crore for all the circles for the spectrum allotted to
them in 2001 or there after. On the other hand, the new operators who will buy
spectrum in the auction to be held now on 12-11-2012 have to pay minimum Rs
14000 crore for 5 MHz spectrum for all 22 circles. If the existing operators
are enjoying spectrum at no cost or nominal cost of Rs 1650 crore, why the new
operators should pay Rs 14000 crore for all India license for spectrum? Therefore
to remove this discrimination, based on the principle of equality, an issue
regarding charging the existing operators for the spectrum held by them for the
remaining period of their license on the basis of the price to be determined by
the auction to be held on 12-11-2012 has arisen. This issue was examined by the
TRAI and it gave its recommendations. These recommendations were considered by
DoT and its proposals were sent to the EGoM(Empowered Group of Ministers). The
EGoM has considered the proposals sent by DoT
and made some recommendations. These ecommendations of the EGoM were
considered by the Cabinet meeting held on 8-11-2012 and certain final decisions
were taken.
Decisions of
the Cabinet
Following are
the decisions of the Cabinet taken in this meeting held on 8-11-2012:
a)
The existing operators need not pay any amount
for the spectrum held by them upto 4.4 MHz ( This is 2G, GSM spectrum in 900
and 1800 MHz bands)
b)
For the spectrum held by them over and above
this 4.4 MHz, the existing operators have to pay a one time charge, on the
basis of the price to be found for the spectrum in the auction to be held from
12-11-2012, on pro-rata basis for the period from 1-1-2013 to till the date of
expiry of their existing license period.
c)
For the spectrum held by the existing ooperators
over and above 6.2 MHz, a one time charge will be levied from July 2008 to
31-12 2012 at the rate of the price determined for spectrum in 2001 duly
increased on the basis of the PLR (Prime Lending Rate) of SBI (State Bank of
India).
(Note: The Government allotted 4.4 MHz spectrum to the existing
operators initially, and subsequently allotted more spectrum to them based on
increase in the number of subscribers. In some Circles, some operators were
given 8 MHz and even 10 MHz spectrum on this basis. Subsequently, in July 2008
the Government decided that the maximum quantity of spectrum to be given along
with license should be 6.2 MHz and additional amount has to be collected for
the spectrum over and above this 6.2 MHz. But inspite of taking this decision
in July 2008, the Government did not collect any thing from the existing
operators for the spectrum held by them beyond 6.2 MHz. Moreover, the
Government could not allot more than 4.4 MHz quantity of spectrum to some
operators who got license in 2001 or there after, since there was no spectrum
available. Hence to bring parity between
the existing operators who could not be allotted more than 4.4 MHz spectrum and
the existing operators who were allotted more than 4.4 MHz spectrum, the
Government took the decision not to charge any amount for the spectrum held by
the existing operators upto 4.4 MHz from
1-1-2013. Since the decision was taken in July 2008 to charge the operators for
the spectrum held by them beyond 6.2 MHz, the Cabinet now decided to implement
it now for the period July 2008 to 31-12-2012).
d)
The existing operators will be given the option
to surrender the spectrum beyond 4.4 MHz if they do not wish to pay this
charge.
e)
The existing operators will be allowed equated
annual instalments for the balance number of years of license (such that the
last instalment is payable not later than 12 calendar months prior to the
expiry of the license) considering interest rate @ 9.75% as approved by the
Ministry of Finance in the case of new successful bidders for deferred payment.
The licensee will also have the option of full upfront payment of one or
pre-payment of one or more instalments.
On the issue of charging in the event of spectrum sharing and intra
circle merger, the Cabinet tokk the following decisions based on the
recommendations of the EGoM:
a)
Sharing of spectrum between the telecom
operators will be permitted without any one time spectrum charge, if both
operators sharing the spectrum have paid for spectrum beyond 4.4 MHz, as
decided above. The license conditions will not be changed for both operators.
Both operators have to pay spectrum usage charge (in addition to the one time
charge as decided above) at the slab rate applicable for the entire combined
spectrum holding.
b)
In the event of merger of two companies on intra
circle basis (since license is given separately for each circle, merger of two
operators will take place on circle basis. Hence it is intra circle merger), the resultant merged
entity would be required to pay to the Government, the differential between the
entry fee and the current auction determined price, on a pro-rata basis for the
remaining period of validity of the
license.
These
decisions are discriminatory and will destroy BSNL and MTNL
Airtel, Vodafone
(at that time with a different name Hutch), Idea, MTNL and BSNL are the old
operators who were given license for mobile services prior to 2001. While
Airtel, Vodafone and Idea were given licenses in 1994/1995/1996, MTNL was given
license in 1997 and BSNL in 2000. The spectrum allotted to them prior to 2001
was almost free without any one time payment, except for the annual payment of
spectrum fee (spectrum usage charge) based on revenue earned.
While the 20
years license period of Airtel will expire in 2014, the 20 year license period
of MTNL will expire in 2017 and that of BSNL will expire in 2020. Thus while
Airtel is having only 2 years of the existing license period remaining, BSNL is
having 8 years and MTNL is having 5 years remaining license period. Hence BSNL
and MTNL have to pay more amount as one time charge as per the decision of the
Cabinet since the amount is based on the remaining period of the current
license. While Airtel enjoyed spectrum without any one time payment for 18
years, from 1994 to 2012, MTNL enjoyed it only for 15 years and BSNL omly for
12 years. To bring equality on par with Airtel, BSNL and MTNL should also have
been allowed 18 years free spectrum. But this was not done. Hence it is
discriminatory.
If the law of
equality should strictly prevail, then why the existing operators should be
allowed spectrum upto 4.4 MHz without any one time payment while the new operators who will be bidding for the
spectrum in the auction on 12-11-2012 have to pay fully for it without any such
free 4.4 MHz spectrum?
When some of the
existing operators were not even allotted the 4.4 MHz contracted spectrum, how
the other existing operators can be allotted 6.2 MHz spectrum until July 2008?
How it can be equality?
Based on the
remaining license period being 8 years, BSNL has to pay Rs 6250 crores (it is
not there in Delhi and Mumbai which are most profitable) and based on the remaining license period of 5
years, MTNL (It is there in Delhi and
Mumbai only and nowhere else)has to pay Rs 4640 crore. But inspite of having
spectrum in the most profitable Delhi and Mumbai Circles along with other
Circles, Airtel has to pay about 4000 crore only. Vodafone and Idea are
required to pay Rs 3000 crore and Rs 1700 crore only.
BSNL has to pay
this amount of Rs 6250 crore in 7 instalments (Its existing license period will
expire in January 2020) along with 9.75% interest. Therefore from 2013 onwards,
every year it has to pay more than Rs 1000 crore towards this charge for the
spectrum beyond 4.4 MHz. Added to this, it also has to pay the charge for the
spectrum it is holding beyond 6.2 MHz for the period July 2008 to December
2012.
BSNL and MTNL
are facing losses for the last three years and they are not in a position to
pay this amount. The losses faced by them are on account of maintaining
landlines which are commercially loss making, but socially required. Hence it
is the duty of the Government to compensate them for these losses. But the
Government stopped such compensation coming under the pressure of the private
operators and the Indo-American CEO Forum (Joint Forum of the big capitalists
of India and America). Thus Government is intentionally causing losses to BSNL
and MTNL. Now it is imposing more burden on them in the name of one time charge
for the spectrum. Such a burden on them will lead to their destruction. They
will become sick and unviable.
The BSNL and
MTNL managements requested the DoT to exempt BSNL and MTNL from this payment.
The DoT recommended for such exemption. The EGoM also recommended for the same.
But the Cabinet did not agree and imposed the payment.
In case BSNL and
MTNL do not want to pay this amount, as per the decision of the Cabinet, they
have to surrender the spectrum they are having beyond 4.4 MHz. BSNL is having 10
MHz spectrum in AP, Assam, Bihar, HP, Haryana, Karnataka, Kerala, Kolkata,
Maharashtra, MP, NE, Orissa, UP (E), and
UP(W). It is having 8 MHz spectrum in Chennai, J&K,
Rajsthan,Tamilnadu (Subsequently TN and Chennai were allotted 2 MHz more,
together) and West Bengal. It is having 6.2
MHz spectrum in Punjab and 7.4 MHz in Gujarat. Therefore in case it opts not to
pay this one time charge, the BSNL has to surrender the spectrum it is having
in all these circles, over and above the 4.4 MHz. When more and more spectrum
is required in view of the increasing importance of data services, surrendering
the spectrum already it is having will not be good for BSNL. At the same time
it cannot pay this one time charge in view of the increasing losses imposed on it by the
policies of the Government.
Why the
Cabinet did not exempt BSNL and MTNL from this payment?
The Cabinet came
under the pressure of the private operators who demanded that if BSNL and MTNL
are to be exempted from this payment, they also should be exempted. This is an
unreasonable demand. The private operators are doing their business only for
profit and they do not carry any social responsibilities facing losses. But
BSNL and MTNL are PSUs working not only for business and profit, but mainly for
carrying out the social responsibilities of the Government. While BSNL and MTNL
are maintaining landline network which makes losses necessarily and
providing together 70 per cent of the brioadband connections in the country by
utilizing the landline network, no such social responsibility is carried out by
the private operators. While BSNL is providing employment to about 3 lakh
employees , Airtel is providing employment to only 25,000 employees. Thus the
task of providing employment is fulfilled by BSNL more effectively as a social
responsibility where as Airteel is not carrying any such social responsibility.
While BSNL is providing SC/ST reservations, Airteel is not carrying out this
responsibility. While the Government has to depend on BSNL and MTNL for
national security in telecom services seector, no such responsibility can be
fulfilled by Airtel. Therefore the Government has to allot spectrum to BSNL and
MTNL in any band free of cost and also should allow them to provide any service
including 4G services on the spectrum they are having, without levying any one
time charge for it. In fact BSNL and MTNL are discriminated by such unjustified imposition of charges for
spectrum and denial of compensation for the landlines losses, inspite of
carrying out several social responsibilities on behalf of the Government.
Save PSUs
BSNL and MTNL to extend services at less cost to the people
The Private
Operators are already threatening to increase telecom tariff since they are
asked to pay the one time charge for spectrum. The mergers and acquisitions
being allowed by the Government will result in reduction in the number of
telecom operators leading to the situation where only a few big operators will
remain and form a cartel among them to increase the telecom tariffs. It will
lead to a high increase in the telecom tariffs. To prevent such monopoly practices,
it is necessary that the PSUs BSNL and MTNL should survive and thrive well so
that the private operators are restrained from increasing the tariffrs. To
allow BSNL and MTNL as viable PSUs for carrying out various social
responsibilities of the Government, the Government should allot spectrum in
sufficient quantity in all bands free of cost to BSNL and MTNL, along with
permitting them free of cost, to provide any service including 4 G service on
any band of the spectrum. Besides this, the Goveernment should compensate BSNL
and MTNL for the losses incurred by them on landlines. The officers and employees in BSNL and MTNL
and the progressive forces in the country should fight for this and change the
policies of the Government in favour of the PSUs.
---P.Asokababu
కామెంట్లు లేవు:
కామెంట్ను పోస్ట్ చేయండి