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HindustanTimes Tue,25 Nov 2014

Former TRAI chief at root of spectrum scam

Vinod Sharma and Gaurav Choudhury, Hindustan Times  New Delhi, February 09, 2011
First Published: 00:18 IST(9/2/2011) | Last Updated: 02:18 IST(9/2/2011)

Former Telecom Regulatory Authority of India (TRAI) chairman Pradip Baijal, it now appears, had a direct role in tweaking policies that saw new telecom licences and scarce radio spectrum being dished out at throwaway prices.

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In a letter dated November 14, 2003 to the then telecom secretary Vinod Vaish, Baijal interpreted a Cabinet decision of October 31 in a manner that allowed new applicants to avoid bidding for spectrum and pay a significantly smaller licence and spectrum fees.

The Cabinet had decided on a multi-stage bidding process for new unified telecom licences and spectrum sale. http://www.hindustantimes.com/Images/HTEditImages/Images/09_02_11_metro_1.jpg

Existing telecom service providers were allowed migration to the unified access service licensing (UASL) regime by paying a fee equivalent to what the fourth operator (in a given circle) had paid in 2001.

At the time, there could be a maximum of four operators in a circle. These were in consonance with the recommendation of TRAI.

Baijal's role in the 2G spectrum scam is currently under probe by multiple agencies. He had joined controversial corporate lobbyist Niira Radia as consultant on completion of his tenure at TRAI. Efforts to reach him for his comments were to no avail.

In the letter to Vaish as TRAI chairman, Baijal ruled that even new licencees will pay fees similar to the amount paid by the fourth operator. By such flawed inference of the Cabinet decision, he circumvented the mandated auction route that would have fetched the government thousands of crores of rupees as additional revenue.

"If government ensures availability of spectrum then in the existing licencing regime, they may introduce additional players through a multi-stage bidding process," TRAI had recommended in 2003.

But for some strange reasons, an interregnum of two weeks had Baijal telling Vaish that new applicants be charged the low entry fee that the fourth operator paid in 2001.

"The entry fee of the new unified licensee would be the entry fee of the fourth cellular operator," Baijal wrote to Vaish in the letter that is in the possession of Hindustan Times.

HT also has the DoT note placed before the NDA Cabinet.

It is evident from these documents that Baijal and Vaish had discussed the matter on phone before the former TRAI chairman put his interpretation of the policy in writing, turning the cabinet decision on its head.

The one-man committee of Justice (retd) Shivraj Patil has pointed to these glaring anomalies in its findings.

It said: "TRAI had recommended additional players could be introduced through a multi-stage bidding process, which was also accepted by the Cabinet. However, in deviation with said requirements, the DoT secretary on the contrary approved formulation of procedure of accepting the applications for grant of UASLs by adopting procedure similar to basic service licenses."

Another startling fact underscored by Justice Patil relates to grant of frequency over and above the start-up spectrum in three different tranches between November 2001 and August 2003.

In the first go, it was enhanced from 4.4 Mhz to 6.2 Mhz, which was later raised to 8Mhz and 10 Mhz, respectively.

The Patil panel held such grant of spectrum was contrary to "extant" directions.

It said DoT made the allocations without approval of the Telecom Commission as also the wireless planning and coordination wing of the ministry.


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