Letters reveal Trai, DoT war of words

Trai said its views must be sought before issuing new licences; DoT said ‘no need’
NEW DELHI: The Telecom Regulatory Authority of India (Trai) had sent out a series of communication to the Department of Telecommunications (DoT) between November 2006 and July 2008 to convince the government that the regulator’s fresh views were important before issuing ‘new licences’.

However, DoT secretary Siddhartha Behura wrote in a letter to Trai chairman Nripendra Misra in July 2008 that there was no need for any further consultation on the matter.

The DoT and Trai have been engaged in a war of words of late on the issue of new 2G telecom licences on a first-come-first-serve basis. While Trai maintains that its views were ignored by the government in issuing these licences, DoT says there is no violation
of policy or of regulator’s recommendations on the matter.

Trai has now posted its communication with the DoT over a period of two years on its website. The letters were exchanged between Trai chairman Nripendra Misra and two DoT secretaries during this period — DS Mathur and Siddhartha Behura.

Dismissing the idea of seeking the regulator’s view on the matter of new licences, Behura wrote to Misra in July 2008 that “the Department has been seeking the recommendations of Trai whenever a new category of licence is to be issued and we feel that no useful purpose would be served by engaging in any further discussion with Trai on the subject.”

The letters from the two sides have shown that DoT and Trai debated on the dictionary meanings of the words “new” and “service provider” at great length to argue their respective cases.

Trai also said that the phrase in the Trai Act, “need and timing for introduction of new service provider,” was significant from the point of view of level of competition in the market and also availability of scarce resource spectrum. “Keeping this in view, our understanding is that before awarding a licence to a new service provider, the licensor shall seek the time-bound recommendations from the Authority,” Misra said way back in November 2006 in a letter to DS Mathur (the then DoT secretary).

In subsequent letters, Trai told DoT that recommendations of the Authority must be sought by the licensor before awarding licence to a new service provider. “The new licences can be processed only after seeking recommendations of the Authority,” Misra said in his letter to Behura dated July 1, 2008.

Behura, however, argued in his letter dated July 2, 2008 that according to the Trai Act, recommendation of the regulator is mandatory only for “a new category of licence,” rather than for new licences. Behura, therefore, concluded that “we feel that no useful purpose would be served by engaging in any further discussion with Trai on the subject.”

Early this year, DoT issued hundreds of new licences without seeking fresh recommendations of Trai. Ever since, communications minister A Raja has been under fire for causing significant loss to the National Exchequer as licences were issued on a first-come-first-serve basis. While the pan-India licence fee for a 2G operator is Rs 1,651 crore, an auction process would have yielded much more.

m_nivedita@dnaindia.net