Steps taken by the Telecom Ministry have revived foreign investor interest in the sector, and the government is on its way to achieve its dream of creating a Digital India, says Minister Ravi Shankar Prasad.
Speaking to CNBC-TV18's Shereen Bhan on the occasion of the Narendra Modi regime completing two years in office, the Telecom Minister said the government had taken policy decisions that had been pending for eight to 10 years.
"Policy initiatives such as spectrum sharing and trading have been cleared," he said, adding that the government has been conducting its spectrum auction in the most transparent manner.
He also discussed the subject of how the government was striving to push electronic manufacturing in the country, but shied away from commenting on Apple, which is in the news amid speculation that the government is unlikely to relax sourcing norms for the company, which would pave the way for it to set up its own stores in the country.
Below is the verbatim transcript of Ravi Shankar Prasad’s interview with CNBC-TV18's Shereen Bhan.Q: Let me start by asking you and I am just going to articulate a very few of the achievements that I have been noting down as far as your ministry is concerned. Rs 1.1 lakh crore by way of revenue from spectrum auctions. Rs 672 crore in terms of operating profit for BSNL. India Post has now got GPS enabled trucks. In terms of the optic fibre network that you have laid out from 350 kilometres you have gone to 1,16,000 kilometres. It is a long list that you have put together. Let me ask you what to your mind would you say has been the biggest achievement of the ministry so far?A: I am talking to you in Sanchar Bhavan. Sanchar Bhavan was in the news for all the wrong reasons for so last many years. 2G shame happened here. I am very happy to tell you, you just mentioned, I am grateful, the highest ever auction of Rs 1,10,000 crore in the most transparent manner possible. No one has raised one finger. I can honestly tell you the entry of middlemen is banned in this building. Decisions are being taken on merit expeditiously. And I can tell you here if I gave 4G licenses I saw to it that all the leading players get it within a space of couple of months to ensure fair competition. So, obviously it has helped in rise of telephony, Foreign Direct Investment (FDI) Rs 27,000 crore in the telecom sectors, one of the highest ever. Mobile phone is rising, phone number is rising, I am very happy looking for brighter days ahead.Q: So, let us talk about the road ahead then. Let me ask you about the next steps as far as your agenda, priorities list is concerned. When can we expect the next round of auctions. You just gave us the figure Rs 1,10,000 crore as the big achievement of your ministry over the past two years.A: One of the big achievements.Q: One of the big achievements. When can we now expect the NIA for the next round of spectrum auction?A: Very shortly. The Telecom Regulatory Authority of India (TRAI) recommendations have come, the telecom commission has taken a call. Now the process is - we have to choose an auctioneer, then we have to go to the cabinet on the pricing part of it. All these things are in the process, we do things properly and remember all the policy initiative pending for the last 8-10 years, spectrum sharing, spectrum trading, harmonisation, liberalisation, virtual mobile network, sharing of infrastructure active and passive all have been cleared by me. Practically there is no policy initiative pending.Q: But can you give us a broad timeline, by when we can expect the auctions to take off. I understand also that the NIA spending on account of clarity required on the spectrum usage charge, the attorney general's opinion was sought on that matter. Where do things stand and give us a realistic time frame when we can expect these?A: Two to three months. I am being realistic, why I am saying so. With my own legal background and with my determination to do things in a fair manner, obviously if there is a legal flaw or legal ambiguity that also needs to be clarified.Q: So, what is the legal ambiguity that you are working with at this point in time?A: I need not talk openly about that. Certain issues have cropped up, on the issue of spectrum user charges. I have personally instructed please have a proper legal clarity. That we will get very shortly, but what is important is when I say two to three months I mean that.Q: So, the NIA will be issued in two to three months or do you believe the auctions will be held in the next two to three months?A: When I say, I say auction.Q: You talked about how the SUC is one of the areas that require clarification and that is perhaps what you are waiting for the AG's opinion to come in on. On the reserve price and we have had this conversation in the past as well, so I don't want to go down that road. But is there any possibility of a review?A: There is a mechanism of pricing. TRAI has twice reiterated the same thing and as I always say India is home to 1 billion plus mobile phones, digital India is going to have an economy of USD 1 trillion in the coming five years from electronic manufacturing to IT, IT enabled services to communication services. So, it is going to be a win-win for all and whenever any auction is there are always murmurs of protest but India is going to be a very big market.Q: Since you are talking about the India opportunity and you were talking specifically about the mobile phone and the handset market, Tim Cook was here in India. There seems to now be confusion over what the proposal of the plan is with regards to Apple because I know that the inter-ministerial committee of the Department Of Industrial Policy & Promotion (DIPP) had suggested that Apple be given a waiver from the local sourcing requirements under the single brand FDI policy. Your department had also supported the DIPP’s view that that waiver should be given. Now we understand that the Foreign Investment Promotion Board (FIPB) has said that yes, Apple can open stores, but there should be no waiver from the domestic sourcing requirements. Is this now a setback for Apple? Is there a need for the government to review the overall policy as far as single brand retail is concerned?A: As far as I am concerned, my idea is to push electronic manufacturing in India. And I am doing so. When I became minister, there was only a Rs 11,000 crore investment. Now it is 1,21,000 crore. You know it very well. Apple is most welcome. Why not? It is a big brand. I am happy he came here. He wanted to have attachment with India, but regarding the whole relaxation of the local outsourcing issue, it is a sensitive issue. FIPB has taken a call, let a final decision, government decision be there, that will be appropriate for me to make a comment instead of me saying something publically because we have to balance both.Namely, we want India’s vendor also to rise. India’s supply capacity also to rise. And right from automobiles, you may have seen that, India’s ancillary industry has done so well. India is becoming a global centre of mobile phone manufacturing, we will have to take also a political call.Q: A political call will have to be taken on whether the waiver should be given to Apple or not?A: That means governmental call.Q: So, which means for instance, would a Cabinet decision have to be taken on this.A: I need not go into it. FIPB today has given a clearance for that. Naturally, there is a process of government decision making. I would request you to await that. But having said that, let me reiterate, Apple is most welcome and naturally to be a win-win for Apple also, because the profound human resource and talent of India’s people.Q: I do not want to talk about this specific instance, but let me ask you. As you sit here today, do you believe that especially since you are talking about trying to invite foreign investors into the country, do you believe that there is perhaps a need to review the single brand policy in whole, so that it does not create any kind of discretion. The reason I ask you this is also because a call has been taken when it comes to FDI in food marketing to do away with the local sourcing requirements because the view of the government is that it is not practical. So, is there perhaps a need then to review the sourcing requirements under the single brand policy?A: These kinds of requests keep on coming. And the government takes a call depending upon the situation and also encouraging local industry to do well. India is becoming a big centre of electronic manufacturing. I am very happy. I went to Korea, went to Germany and I am very happy today. All the brands are in India. Apple is also coming to India, most welcome. But we have also to encourage local sourcing as well. So, this again relates to my first answer a proper call will have to be taken depending upon issue to issue. I cannot make any specific comment because a lot of misgivings are there also as far as India’s own enterprise is concerned. So, we have to have a blend of the interest of both.Q: So let me move on and talk to you about some of the other pillars as part of the Digital India campaign which is one of the big campaigns of this government and one of the key achievements over the past two years. You got 9 pillars under the Digital India campaign from broadband infrastructure to public services, to the internet and so and so forth. Where would you say that things currently stand as far as your targets for each of those 9 pillars are concerned and what more would you now need to focus on as you start year 3?A: First of all optical fibre networks when our government came just 358 kilometres of optical fibre and 2,000 kilometres of optical pipe. Now we have 140,000 kilometres of optical pipe and 116,000 kilometres of optical fibre, that’s the speed we are going. You talk of digital delivery of services. Last year it was hardly about say 30-35 crore now it is 58 crore that is there. Digital services are rising from e-scholarship portal to hospitals are being linked, to jeevan praman, to mygov, people involvement all those things are doing quite well. Three other infrastructures which I am doing in a big way is common service centres who are giving digital delivery of services in the hinterland.They are numbered from about 80,000 now it has reached to 199,000 I want to scale it up further. BPO call centres in the small towns of India that will get jobs, the process is going on and I am telling you the result is very, very exciting. I want the viewers of your great channel to know that we went for the expression of interest against 48,000 seats, 78 companies showed interest of 125,000 seats at 190 locations of India like Bhagalpur, Deoria, Jaisalmer, Jabalpur all the hinterland of India. That process is on till June 30 that is doing quite well.Postal part I must talk -- I would like you to give me an opportunity to talk -- separately. The virtual mobile network a great policy initiative pending for the last many years and what is that you don’t need to own spectrum or infrastructure, you can become the outsourcee and supply part of it and lastly which is again very, very important that active and passive sharing of infrastructure by all the mobile operators and others. Therefore all these infrastructure issues would lead to a cascading effect today from your transportation services, to driving licences, to income tax return, to land record most are being digitised. I am encouraging that in further accelerated way.Q: Which you are broadly calling e-kranti as part of what your ministry is trying to do, but let me ask you a broader question ...A: I would like to interrupt you here. How India is changing where you are also involved as CNBC-TV18, Digital Desh which you are encouraging. It is a classic example of changing profile of India through mobile phone and reinforces what my Prime Minister always says, I want governance to be available in the mobile phone of India and Digital India is most for the poor, underprivileged, a mason, an electrician, a puncturewala those who are doing manual job must have greater opportunity with the help of their smart phone and digital desh, I wish to congratulate you which you have promoted showcases how people in the hinterland are empowering their life through smart phone.Q: What you see as far as the landscape for the telecom industry is concerned. Over the years there has been lot of talk of consolidation and finally we have moved toward that largely on account of the fact that you have cleared the spectrum sharing and the spectrum trading policy. When we talked to industry they talk about how India has way too many telecom companies and they believe the right number would perhaps be 3 or 4. In your assessment as things stand today especially with the advent of 4G how do you see the complexion of this industry going forward?A: My job is to create the enabling atmosphere, in terms of policy, in terms of infrastructure. Let the consumer and the dynamics of the market drive it out. Those who will be giving the best service naturally will get the best consumers clientele therefore I cannot be judgemental on the consolidation part.Q: Do you see that there is likely to be more consolidation, I mean Telenor has openly said that they will either be a part of the consolidation or they will be forced to exit India especially if the reserve prices remain where they are as per the recommendation of the TRAI.A: I have to only do in a fair transparent manner and I wish to make it clear if someone wants to have administrative allocated spectrum sorry that is not possible.Q: But how do you see the game changing especially now that you already got a couple of players in the 4G market, you will see competition heating up perhaps towards the end of the year or closer to the end of the year. How do you see that really change the dynamics of this business?A: I don’t think as a telecom minister of India I need to be judgemental there. Let the market forces take a call on that, but yes I can only say I have done my part and mobile operators have done a great job in the country by bringing mobile to the nook and corners of the country. What is more important is that let the consumer be happy with the services. Let there be a fair competition that’s how I wish to do.Q: Since you are talking about services and you are talking about the consumer, let me ask you about the issue as far as call drops are concerned. The TRAI Chairman in his interview to us a couple of days ago has said that if necessary the TRAI will look at the possibility of another consultation paper on how to address this issue in the context of Supreme Court's observation. As Department of Telecom (DoT) and I know that this is the remit of the TRAI but as DoT, is there a need at this point of time for the government to perhaps consider amending the TRAI Act at all, so that what the Supreme Court has said can perhaps then be executed in reality from a consumer's point of view?A: Let me again repeat, I have been saying from day one, I am the minister for telecom growth and I am also the minister for consumer interest of India. I have done my part all on the policy front. As you rightly said, it is the remit of TRAI, but a good service, a satisfactory service is also in the interest of the operators and the people want good service. Of the JAM Trinity, Jan Dhan Yojana, Aadhaar, the last is 'M', mobile. Mobile is going to become an important component of Digital India's success, from commerce to other things and this journey from desktop to laptop to smartphone. So, I think all the operators need to understand.I understand that they have installed about 95,000 plus sites in the country, about 5,000 in Delhi, but they need to work more and as a minister, this department will continue to persuade and also monitor this aspect as to what is their obligation towards the customer and the larger quality parts, standards parts is there for the TRAI to decide.Q: Some telecom companies have now decided to go the self-regulation route and they have said that we will try and do better than the TRAI benchmark of quality standards and if not there is a certain percentage, it has been capped at a Rs 100 crore for a particular company, but that will go towards funding education for the under privileged. Other companies may follow suit as well I am assuming but what do you make of this?A: My take is very simple, self regulation is entirely their own architecture; I need not comment. However, for me the biggest standard is consumer satisfaction, distinct improvement. Again I say, some improvement has taken place, they need to do more.Q: Let me talk to you about India Post because I know that you feel very passionately about that and at the outset I spoke about some of the things that you have been able to do for instance GPS enabled trucks, etc as part of India Post. On the banking aspirations you have of course got the licence for India Post when do we actually see that take off?A: Since you talked of India Post, this has always been a little indifferent body. Kindly see ATMs were four when I came to power. Now they are 913. Core banks 230, now it is 22,000 odd. See the right of e-commerce. 80 percent, from Rs 100 crore to Rs 1,300 crore. Speed Post has become top class. India Post has got a platform of 1,50,000 plus post offices. This can become an important vehicle of financial inclusion. Payment bank is small, taking 1 lakh taking, 1 lakh giving. But the platform is so energising it has created a buzzword around the world and I can share with you. About 50 domestic and international consortium have sought a partnership with India Post. Who are they, Barclays, Deutsche Bank, Citibank, World Bank, Templeton, all the banks of India, all the mutual funds and insurance companies of India, except LIC. Why, and I am giving handheld device to all my 1,30,000 postmen for doing all the services of insurance and banking. Can you understand the game changer which India Post digitally connected with core banking in going to offer to the country. Therefore I have fixed a timeline of March next year.Q: March next year for the banking operations to start?A: Yes.Q: Okay, that is a good news point. On that note let me also ask you about another issue because the government has finally articulated not revealed yet, but at least articulated its policy as far as strategic disinvestment is concerned. At the start we were talking about BSNL and I remember when we first spoke when you had just taken over you said that this talk about a possible merger of BSNL-MTNL is premature because you were first like these companies to come back to some degree of financial health before you talk about road ahead. Where things stand today?A: I am very happy you have asked that question to me and it is a matter of great personal satisfaction in a modest way. When in 2004 BSNL made a profit of Rs 10,000 when Bajpayee government left office. In 2014 loss of Rs 8,000 crore. Now Rs 672 crore operating profit. I am happy to share with you, it is likely to cross Rs 2,000 crore operating profit when the final account is done in this year. That is the unique achievement of mine.The mobile phone was 8 lakh last year, now it is 23 lakh per month. Revenue growth four percent plus. Land line free from 9'o clock in the night to 7'o clock in the morning plus doing all the social service. Today I would like the viewers of CNBC to know why PSU turnaround is a matter of great satisfaction. They have to suffer L1 in contract, they have to face questions in parliament, they have to hear the scolding of the ministers, they have to go before the standing committee, CVC, PIL, Supreme Court, contempt everything and in spite of all this if you turnaround in view of these adversities it is a matter of assurance.BSNL is now on the right track, they need to do more and I am very happy that they are talking of going with other strategic partnership or other issue. That is good luck to them, I give them complete freedom. For me performance is the only criteria. It is something nostalgic also when I was the coal mine minster in Bajpayee government. Coal India had suffered a loss of Rs 49 crore and in one and half year I turned it around to a profit of Rs 1,500 crore. From Coal India to BSNL I had the privilege and honour. Bajpayeeji then, Narendra Modiji this time. To give me the chance to turn it around. Therefore two years down the line at least that point I can say. MTNL needs a lot of improvement.Merger part, I always say will have to be considered in detail. Because let one entity become healthy and I am flexible, my officers are working out as to how we work out a model of greater cooperation and synergy between MTNL and BSNL.Q: But that does not mean a merger at this point of time?A: Not presently.Q: So, that is as far as your plans for turning around BSNL and MTNL are concerned. Would it be fair then to assume that these would not be candidates on the government's strategic disinvestment list?A: I cannot make a comment now. Some share or other parts I would like them to become more professional and in March of this year as per TRAI rating of February BSNL has notched the highest customer in that month surpassing even private operators. So, if PSU is doing well, let them do more well. What is the harm part of it.The strategic part of disinvestment is concerned that call has to be taken on a variety of factors. As of now I have to showcase how Narendra Modi government can turnaround a chronically sick PSU for the benefit of common people and don't forget one thing. When floods come they give free services, when earthquake comes they give free service, then they donate with that. I talk about India Post in the Sukanya Samriddhi Yojana they have opened 85 lakh plus account, Rs 4000 crore plus. All the banks together only 4 lakhs. Therefore they also do public service.Q: Let me also ask you about another issue which you passionately taken on which is electronic manufacturing. Significant steps have been taken on that front. You of course put a policy in place to incentivise Make in India. What is the target that you have set for yourself now as part of year 3?A: Just to simply put it when I became minister it was Rs 11,000 and odd crore investment. Now it is Rs 121,000 crore. All the big players are in India. You talked about Apple. Electronic manufacturing has become a big buzz word. All the CMs are today online. They are seeking investment. If you ask my ambition two years down the slog overs are over, the slog overs are now over. Now we have to ball well and bat well because lot of time has taken in restoring the whole credibility but was part of a legacy issue. I foresee Indian emerging as a big hub of electronic manufacturing from electronic mobile phone, to set top boxes. Already we have cleared that, to iPad, to solar power panel, to automobile ancillaries in terms of electronics to medical electronics, to defence electronics. We see developing as a big ecosystem and I have not ignored the human resource part of it. About 1,200 PhDs scholarship from my department are being provided for in various NIT and IIT. Flexible electronics is being encouraged in IIT Mumbai and Kanpur. These how we are doing ecosystem of electronic manufacturing from policy to human resource to M-SIP (modified incentive scheme) all are working well. I think as India is emerging as a global economy of scale electronic manufacturing will pick up very well in India.Q: Let me move away from your department and talk to you about what happening in general. I understand now that all of you are going to be fanning out from Kashmir to Kanyakumari over the next one month trying to convince or sell the story of your government to the People of India. Just before I came here I was having a conversation with Derek O’Brien and he said that in a sense it’s going to be the start of the federal front, they are not calling it the third front anymore. They are calling it the federal front. You are going to have Akhilesh Yadav there, you are going to have Arvind Kejriwal there, you are going to have Nitish Kumar there and of course Mamata Banerjee is going to be sworn in, in the state of West Bengal. What do you make of this idea of the federal front?A: First of all in fairness to Mamata Banerjee also invited me, but I am going to celebrate the two year. May be Mr Jaitley may be going, maybe I don’t know. What is important is good luck to anyone. India is a federal country and Modiji is very keen, he wants to work in the best partnership possible. You remember he was first to congratulate Mamataji, to Nitish Kumar, to Arvind Kejriwal whoever wins, but this front part is more of a past. Remember one thing, a front in order to become a credible challenge to the BJP and NDA needs to have the glue of a major political party and (b) I am only referring to the history from the days of Mr Chandra Shekhar, to Mr Deve Gowda, to Mr Inder Gujral and to VP Singh what happened. Therefore anyone freed to so, let federal front there, good luck to them, but very gently a reminder there is no vacancy for the post of Prime Minister now and not for many years to come.Q: So you are making him the prime minister post 2019 as well. You are quite convinced about that?A: Obviously, people will bless for our work. The reason why we have done well this time from Assam to Kerala people are saying the honest performance of this government and the foreign policy initiative from Iran Chabahar Port, to Saudi Arabia, to UAE. I had just been to Sweden only last week and I see what credibility India’s economy and our leaders enjoys world over.Q: As you speak with foreign investors, is there a likelihood of a new player looking at the Indian market, the speculation and buzz about AT&T comes up every now and again. You have been listening to it as well as have I. Do you foresee a new entrant coming into the Indian market?A: I have only overheard that they are interested in coming to the virtual mobile network corporations. I have heard I have no sure information, but if they are keen to come, guideline I have already approved. They are most welcome, why not. Let all the player come, most welcome, I am just a phone call away if you have any problem.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
