Foresee local calls at 10p/min, STD at 25p/min: A Raja

Published on Mon, Oct 26, 2009 at 15:07 |  Source : CNBC-TV18

Updated at Fri, Oct 30, 2009 at 18:22  

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A Raja, Telecom Minister

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Telecom Minister A Raja says the stake dilution by new operators has been cleared by Finance Ministry and Cabinet Committee on Economic Affairs (CCEA). He explained that the FDI policy does not come under the Department of Telecom's preview, and hence the ministry cannot prevent share dilution.

A Raja is in the eye of the storm over corruption charges relating to the Department of Telecom's (DoT) awarding of 2G telecom licences and spectrum. However, Raja says he is unjustly targeted for breaking up cartels in the sector. "The entire industry is a divider. Everybody is having their own commercial and vested interest. They wanted to maintain their monopoly. I wanted to break the cartel. When I broke the cartel, all these things came into existence."

Raja says he is responsible for doubling telecom growth in India.

Post the 3G auction, he plans to focus on new technology for rural telephony.

Raja foresees local calls at 10 paise per minute, STD at 25 paise per minute.

Here is a verbatim transcript of an exclusive interview with A Raja on CNBc-TV18. Also watch the accompanying video.

Q: Let me begin by asking you, you have been a minister who took the gauntlet of introducing more competition. But that has been accompanied by a lot of controversy. How do you feel about it? Do you feel rewarded or do you feel pain for your efforts?

A: This is not a question of whether it is painful or rewarded. I do feel that I did my job according to my conscience and according to law established in this department. When I assumed charge as telecom minister, my categorical assurance that was given to the people at large, even in the parliament as well, is that I will brief parliament according to the TRAI recommendations. Ultimately, it will give the new reduction of tariff and the rural tele-density will go off. You see within three years or two years, from 2007 itself, you see the tangible reduction of tariff and how the rural tele-density is coming up. Of course within two years, the rural tele-density you cannot imagine that there will be such tremendous growth, the tariff will come down. As I promised earlier in the local call, within a circle or within a state, the local call will be 10 paise and the whole India call will be for 0.25 paise.

Q: You mentioned the TRAI recommendations. There are two issues that are consistently thrown at the department. One is that you introduced something called first come first serve, which was wrong, according to your detractors. They also say that you had a deadline of October 1 for application and it was suddenly advanced by five days. Then they also say that you cherry pick, the department cherry picked from TRAI recommendations. What do you have to say to that?

A: No. I am speaking broadly. The recommendations are many more. Some of the recommendations need to be consulted with the industry and other stakeholders. You cannot say that whatever recommendations given by TRAI can be implemented at once. But some of the recommendations may need urgency to be implemented. Accordingly, some of the recommendations may be put into controversy. Maybe a few recommendations are still pending where industries are not accepting it. Most probably I can share with you that termination of access deficit charges. When a call is made through an operator and the call is being terminated by another operator, the operator is being paid to terminate the charge. I think that this has to be revisited. But when you are revisiting the thing, then controversy definitely comes in because someone's interest is going to be put at stake. So in such cases, the industry should not be divided. Ultimately, there should not be any strike or unrest in the industry. When there is unrest in industry you cannot have growth. So, by forcing all these things, one or two recommendations are still being debated in the ministry. That is different. That does not mean ministry or minister is doing cherry-picking. That is not correct. So far as the new operators and competition is concerned.

Q: Is it first come first serve?

A: I will come to that later. I cleared it in the parliament as well. What recommendation says is no capping. They didn't tell how many operators, how to be allotted and at that time neither the ministry nor the minister nor TRAI knew what type of competitive applications will be filed to this much. One thing I must share with you, why DoT has chosen after consultation with the Solicitor General of India, who represented the cases before the TDSAT and High Court of Delhi at the time, they accepted on 25 September, the department. Of course it came to me and later I endorsed it. The reason behind this is, these are all the applications originally pending with the industry notwithstanding the recommendations made by the TRAI. One step I can go further and say on record is that the recommendation itself was sought on the basis of the pending applications and not on the basis of new applicants. So when I discussed with the officers, they accepted the idea and thereafter I referred the matter to the solicitor general. I consulted with the highest Law officer in the country also, and he said it's a reasonable classification because you cannot process the 500-600 applications. Again about the first come first serve policy, it is not invented or introduced by me. It was inherited in the year 1994 from the old license condition. When we migrated to the unified license conditions and it was inherited by the old conditions by the then minister. Right from the Arun Shourie period, he was one of the ministers who permitted some files on the basis of the first come first serve policy. As a matter of surprise, I found some of the files negative since it was not in order as per the first come first serve policy. So, commission and omission both have been recorded on the file that the file is being approved on the basis of the first come first service policy and the other file is being negative, since it has not followed the first come first serve policy.

Q: Do you remember the company for which it was negative?

A: I don't know but the files are there and I have come across that.

Q: The central bureau of investigation (CBI) has also visited the Department of Telecom. They have put out a press release which mentioned that the spectrum had been underpriced and sold at 2001 rates?

A: The investigation is being made by the CBI, so I don't want to be involved in that. The law will take its own course. I cannot preempt the investigation. It is not fair on the part of the cabinet minister and also I am a lawyer and I know the constitution. So I don't want to interfere, but broadly I wanted to say that the spectrum charges are something different and the license fee is something different. People are having wrong notion about whether it is press, a parliament or ordinary persons or scientists. With due respect to all these gentlemen, I must say, the people those who are writing and speaking today, most of them are not aware what is meant by spectrum charge and what is meant by license charges. The acquisition which is being made right from the beginning that the license fee of Rs 1,650 crore which was fixed in the year 2001 has not been revisited. The first thing I want to share with you is revisiting the license fee which was fixed in the year 2001 by TRAI is not within. So for argument sake, suppose if I am telling, I am the minister for telecom and if I want to revisit it, shall I put it 2010 and then people will say how did Raja arrive to Rs 2,000 crore or like that. This is not arbitrary. I am not the deciding authority, TRAI will be the correct person to give the recommendations. In 2007, TRAI says go for new competition, it did not recommend go for the new fee, as a matter of fact again 3G auction came in before the committee. Even then the government permitted that a new operator can come it will be a global action and even at that time it was accepted that we will give the license to the person who is successful bidder in the public auction and even then the license fee was not been enhanced by the EGoM. So that led us to position last month the EGoM that was constituted by the Prime Minister, to settle the issue for the reserve price and the number of slots and that the EGoM did not recommend that it has to be hiked.

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