Tuesday, March 19, 2013

Don't kill the poster boy - Derailed reforms in telecom sector.

If someone asked me to give an example on what India gained through the liberalization moves started in early 90s, my answer will definitely be 'look at Telecom sector'. You can see brands of telecom companies, no matter whether it is Vodafone or Airtel, even in the remote areas of India - which may not even have proper roads. Honestly speaking, mobile phone technology not only revolutionized Indian environment, but also in many African countries as well.

After more than two decades of liberalization and more than one full decade of telecom revolution we are supposed to have a strong and clear cut policy in telecom licensing and taxes. Unfortunately, these policies are not yet clear. It’s not only government but telecom companies itself are doing self destructive infighting - which will little add anything but value; old timers Vs new entrants, companies using CDMA technologies Vs GSM, companies holding additional spectrum Vs others etc.

Government is not able to stick to a policy for long. 2G spectrum allocation, subsequent de-allocation, later not so successful auction of recovered spectrum is a case in point. 3G spectrum allocation brought huge amount of money to government treasury, but at the same time reduced the financial capacity of service providers. I still believe that, if companies paid less amount of money for 3G frequencies, then users may not have to pay what they are paying now for using 3G.

Now the case of underreporting came in to focus and companies are asked to pay 1,842 crores in additional fees for the allegation of under reporting their revenue.


Telecom is an important sector. Moreover it is the poster boy of India's liberalization. If government has to go ahead further with economic reforms, then they have to convince general public that they are going to gain something. Believe me it is difficult to convince people without a proper example - a symbol. In India's case it is telecom. So please, for our country’s sake, sit together discuss and come up with a policy paper - just, competitive, effective in both letter and spirit as well as in implementation.


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