The Telecom Regulatory Authority of India (TRAI) has no plans to cap the number of service providers in a service area, it is learnt.
NEW DELHI: The Telecom Regulatory Authority of India (TRAI) has no plans to cap the number of service providers in a service area, it is learnt.
Though there is no such cap at present, the Department of Telecommunications (DoT) had felt the need for a review of this policy, mainly because of spectrum scarcity, and had referred it to the regulator for a review.
The regulator, which is working on the recommendations for fresh licensing and merger & acquisition (M&A) norms, has an open mind on the issue, a source close to the development said.
In fact, at a recent open house, TRAI chairman Nripendra Misra had made it clear: “TRAI has no view or opinion on the issue of capping the number of operators at this point.”
Though TRAI is likely to submit its recommendations by August 15, a final call on them rests with the DoT.
Although global systems for mobile communications (GSM) operators like Bharti, Vodafone Essar and Idea favour a cap in the number of operators in a licence area, code division multiple access (CDMA) players Reliance Communications and HFCL are against the idea.
Interestingly, parliamentarians, cutting across party lines, are also against capping the number of operators.
Tariq Anwar, general secretary of the Nationalist Congress Party, for instance, has written to Union communications minister A Raja, saying that, “There is a very strong case for India, with such a high growth potential, to leave the question of number of telecom service providers to the unfeterred play of market forces.”
“Any steps towards capping the number of operators will also be against our national economic policy of promoting free market economy and doing away with the curbs that existed during the licensing regime,” Anwar added.
According to Anwar, limiting the number of telecom licensees is also likely to adversely impact the growth of broadband in India. While there are only about 25 lakh broadband subscribers in the country now, the government has set a target of 20 million by 2010.
Another M P, P S Gadhavi, has shot off a letter to Nripendra Misra, arguing that “any act of stifling competition in the sector in the name of spectrum unavailability needs to be countered with full force”.
He pointed out that TRAI should stick to the task of creating a congenial regulatory environment that encourages free competition and leave the task of determination of number of operators to market forces.
Sanjay Dhotre, a member of the standing committee on communications and IT, has told Misra: “Any step to kill competition in the garb of spectrum unavailability should be seriously countered in the public interest.”
Jitin Prasada, who’s also on the standing committee of telecom and IT, has argued that “due to the policy of technology neutrality and of equal opportunity, all existing operators should be permitted to use the alternative technologies in addition to the existing technologies.”
JNP Nishad, another parliamentarian, has said that India is a country with a population of 120 crore and there are seven to eight telecom operators.
He has argued that the population per operator is the highest in India, and that there’s a huge room for growth.
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