Government to decide on state telcos call for 3G fee refund soon

The Union cabinet is expected to take a decision soon on whether to refund the money paid by state-owned telcos, Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL), towards spectrum for 3G (third generation) and telecom services.

When asked on the issue, minister of state for communications and information technology Sachin Pilot said, “it would be a collective decision of the government” as several ministries including the finance ministry would have a say on the refund matter.

Both BSNL and MTNL have sought a refund of the 3G spectrum money that they paid to the government recently. They may make a similar demand to the government for the money they have to pay for wireless broadband spectrum by June 22.  

If the government agrees to fully refund the state telcos on 3G and wireless broadband, it would have to shell out over Rs 28,000 crore, out of a collection of Rs 1,06,000 crore.

BSNL and MTNL got 3G and BWA (broadband wireless access) spectrum more than a year ago, while private operators would get it only in September. Even as private players made an informed decision on bidding for spectrum during the recent auction, BSNL and MTNL have had to match the highest bids without participating in the auction process.

The state telcos are now arguing that they have been allotted spectrum across service areas for 3G and BWA without being given any choice. No private telecom operator had opted for pan-India spectrum in 3G and only the Nahata group-backed Infotel (95% of which was bought by the Reliance Industries) bid for pan India BWA spectrum.

Even as Pilot refused to get drawn into the controversial issue of whether the state-owned telcos should get a refund for the 3G and BWA money or not, the minister pointed out that “BSNL does a lot of work in the rural remote corners of the country that no other private telecom operator does.”

The social obligation that BSNL fulfils, no other telco does, he argued. The minister referred to BSNL giving connectivity to Amarnath pilgrims as the latest initiative by the state telco.

Commenting on the recent 3G and broadband auction, Pilot told DNA that “it’s good news in all aspects.” The auction has been very positive in attracting huge revenue for the government. Also, it would help improve telecom access to the masses across the country.

Asked about the recent recommendation of the Telecom Regulatory Authority of India (Trai) on 2G (second generation) spectrum charges, Pilot said, “the Department of Telecommunications (DoT) has to take a considered view on it.”

Pointing out that the government would not rush into a decision, he said, “we as a government will take a view that will result in consumers getting good quality service at reasonable rates.” He added, “We will do whatever it takes to be there.”