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Slowdown in telecom sector following 2G auction: JPC told

PTI  New Delhi, February 12, 2013
First Published: 21:27 IST(12/2/2013) | Last Updated: 21:30 IST(12/2/2013)

A top telecom ministry official on Tuesday told the JPC on 2G scam that the telecom sector has witnessed "some slowdown" following the recent auction of the 2G spectrum and the increase in its base price could lead call rates to go up marginally.

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Secretary telecom R Chandrasekhar also told the Joint Parliamentary Committee (JPC) that the calculation of telecom minister Kapil Sibal that there was "zero loss" in the allocation of 2G spectrum was "realistic" if the loss is measured with regard to application of the prevailing policy.

In reply to a question on whether there will be any increase in the call tariffs subsequent to the auctioning of the licences, Chandrasekhar said there will be slight increase - 5 to 10 paise - according to the assessment of TRAI because of the increase in base price.

He said the DoT has not yet made an assessment in this regard.

JPC chairman PC Chacko quoted the telecom secretary as saying that there has been "some slowdown in the growth rate (of the sector) as a result of the auctioning of spectrum."

"Also there has been instances that service providers are withdrawing freebies, incentives subsequent to this," Chacko said after the meeting quoting Chandrasekhar.

Chandrasekhar was asked about Sibal's zero loss theory and DoT's view on that.

"He (Chandrasekhar) said if loss is measured with regard to application of the prevailing policy, then the calculation is realistic. But if we go by several other alternatives, then obviously there is potential to raise the revenue," the JPC chief said.

When asked whether base price based for auctioning the spectrum is unreasonably high, the telecom secretary said that among the 18 circles, there had been no bid above the base price and only in one circle, the bid was 10% higher than the base price.


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