On 2G, the policy dilemma remains
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And for that, the CAG, the court and the media must share responsibility
The din on 2G has subsided. It is time to reflect. Is the road ahead, after the pronouncement of the Supreme Court, any clearer now? The unintended axis of the report of the CAG, the public interest litigant and the media made informed debate a victim. Did those who cried foul fully understand the complexity of a sector that was nascent? We were traversing virgin territory. There were no examples to learn from. Other nations were also learning from their mistakes.
The NDA put in place a roadmap for migration when a troubled telecom sector could not honour its commitments. An auction in 2001 determined the price of Rs 1,658 crore for entry in a regime where spectrum was bundled with the licence. Thereafter, free spectrum was bundled with the licence at that price for those who wished to enter the market to provide telecom services. In 2001, tele-density was 3.58 per cent. For the uninitiated, it was a risky venture. Our domestic players were inexperienced. The government had no means to analyse the potential for profit over the 20-year term of the licence. Yet those who received the licence, in 2001, 2004 or in 2006, were, in retrospect, enriched. These licences expire in 2021, in 2024 or in 2026, as the case may be. Should public servants who gave these licences at that time be prosecuted for giving away a valuable resource for a pittance? Of course not.
Much before 2026, new technologies may emerge that may further enhance the profitability of these licencees. Should the government be blamed for not anticipating the emergence of such technologies? There is in place a regime in which the government shares in the profits through increased spectrum usage charges as the customer base increases. An annual charge in the form of licence fee, again linked to the customer base, also accrues to government.
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