The mistake that the government have made in India is to assume that it is healthy to have as many competitors as possible, points out Vodafone India CEO Marten Pieters while declaring the company's quarterly results. Vodafone's revenues slipped up for the financial year 2013 due to weak performance in India.
Speaking exclusively to CNBC-TV18's Malvika Jain, Vodafone India CEO Marten Pieters says that he is in discussion with other participants in the telecom sector to explore business opportunities. "It is a reality that the M&A (mergers and acquisitions) rules have made any form of consolidation unattractive."
On the rollout of 4G services and the possibility of partnering with a domestic participant, Marten Pieters adds that he is interested but would prefer to wait a few years and for a different spectrum.
One of Vodafone's large shareholders, Piramal, has indicated his plans to sell his stake in the company. "As a company we have many shareholders and if he wants to sell his shares, it is upto him. He will have to find a buyer for the stake and that is completely unrelated with the 4G issue," says Marten Pieters.
The Vodafone India CEO does not agree with the finance minister's statement regarding the monopolistic nature of the telecom sector. "This is a market where competition works very well. What has been observed in most countries is that three, four or five operators are more than enough for a really healthy level of competition — lower prices and good service offerings —in a much more efficient way than a real monopoly could ever do," he adds.
Commenting on the government raising the reserve price to prevent cartelisation, Pieters says, "The government has done that and so far, it has not met with great success. So, that strategy doesn't work. The government would be far better off to link it to a market-determined price."
Pieters says that the reserve price, currently two times of 1800 Mhz, should be the same level as the price of the 800Mhz spectrum which was 1.3 times. "It is a comparable spectrum."
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