After hectic lobbying with the government to ensure that its investments in the Indian market do not suffer due to the Supreme Court ruling to cancel 122 licences issued in 2008, Norway’s Telenor has moved swiftly to submit its recommendations to Telecom Regulatory Authority of India (Trai) for auctioning process.
The apex court directed the government last week to hold auction for fresh licences after taking Trai’s recommendations within a month.
In its note to the telecom regulatory body, the Norwegian telecom company, which has invested up to Rs14,000 crore in the country till now, has asked for the incumbents to be kept out of re-auctioning to maintain the “spirit of competition” in the market.
Sigve Brekke, managing director of Uninor — joint venture between Telenor and real estate firm Unitech - said the SC has specifically mentioned in its ruling that “fresh licences be granted by auction”.
“This auction should be about fresh licences. That is what the court order implies and so the incumbents (Bharti Airtel, Vodafone and others) should not be included,” he said on Friday.
Brekke also suggested that the auction process should be split into two rounds wherein the first should allocate new licences with spectrum not less than 6.2 MHz and second should auction remaining spectrum. He said the second round should invite all the players - new and old licence holders.
“Once everyone (old and new licencees) is on equal footing (with minimum one block of 6.2 MHz ) after the first round, there should be auctioning of spectrum for building capacity,” said Brekke.
The Norwegian company, which wrote down $721 million as impairment loss for its Indian operation last week, suggested the reserve price for the auction be fixed at the last discovered price of Rs1,658 crore in 2001.
It said the market price that would emerge from auctioning should be applicable for the licences of the incumbents, too. “They (incumbents) should also pay extra (over the Rs1,658 crore paid for licences in 2001). If we pay, they also should. There should be no discrimination,” said Brekke.
He also said the amount of spectrum available through cancelled licences and other sources should be made public by the government. “All of it (available spectrum) should be auctioned now. Nothing should be held back,” said the Telenor top executive.
Brekke also refused to comment on whether Telenor would partner with Unitech to take part in the rebidding. The two have been entangled in a legal battle over which route to take for raising long-term finance for expansion. As per the current regulation, a foreign investor cannot hold more than 74% in a telecom venture.
“We will first look at the terms and conditions and other details of auction. We are taking one step at a time,” said Brekke.
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