2G auction: DoT’s letters to TRAI raises eyebrows

The Department of Telecommunications’ (DoT) letter to the Telecom Regulatory Authority of India (TRAI) on the impact of spectrum pricing on telecom tariffs, for the third time, has raised eyebrows. Manoj Gairola reports.

The Department of Telecommunications’ (DoT) letter to the Telecom Regulatory Authority of India (TRAI) on the impact of spectrum pricing on telecom tariffs, for the third time, has raised eyebrows. According to section 11 of the TRAI Act, 1997, the government can ask the regulator only once to reconsider its recommendations.

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On April 23, the regulator first submitted its recommendations on spectrum auction to the government. After reconsidering the points raised by the government, it submitted a fresh set of recommendations on May 13.

On May 14, Rahul Khullar took over as the new TRAI chairman from JS Sarma. Now, the government has again sought the telecom regulator’s views on the impact of pricing on tariffs.

According to section 11 (d) of TRAI Act: “….if the Central government having considered that recommendations of the Authority comes to a prima facie conclusion that such recommendation cannot be accepted or needs modifications, it shall, refer the recommendations back to the Authority for its reconsideration, and the Authority may within fifteen days from the date of receipt of such reference, forward to the Central government its recommendation. After receipt of further recommendation, if any, the Central government shall take a final decision."

However, the Act also says that the government can always seek TRAI’s views on any important issue. The DoT has sought TRAI’s views on almost the same subject with slightly different scenario. The DoT has asked TRAI to calculate the impact of pricing on tariff by applying proposed prices on the entire spectrum held by existing operators.

“This will set a wrong trend and undermine the authority of independent regulator,” said a Delhi-based independent analyst.