The Comptroller and Auditor General (CAG) has found that a set of spectrum was allocated to a telecom operator in 2015 on first-come-first-serve (FCFS) basis, in contravention to the recommendations of a committee. In its report it called out various shortcomings in spectrum management by the Department of Telecommunications (DoT) that have led to losses to the exchequer.
In its report tabled before Parliament recently, the auditor noted that the DoT had constituted a committee in December 2012 to study the allotment of spectrum in various categories of spectrum users and proposed that the spectrum allotment in microwave band to all the operators should be done through market-related process of auctioning.
“However, in contravention of the committee’s recommendations, allocation of MW (microwave) access spectrum has been done on FCFS basis till date as was being done for 2G licence and access spectrum till 2009,” the report said.
In 2012, the Supreme Court had struck down FCFS policy in 2G spectrum allocation case of 2008-09 and cancelled 122 telecom permits that were granted spectrum through the process.
Microwave access (MWA) spectrum is allocated to telecom operators for short distances to provide mobile services. “It was also found that allotment of MWA to access service providers was withheld by DoT since June 2010 and allotment against only one applicant was made in December 2015. There were 101 applications pending till November 2016 for allotment of MWA,” the CAG said. However, it did not disclose the name of the company to which the allocation was made.
As per the CAG report, the government had an adverse financial impact of around Rs 560 crore due to various instances of spectrum mismanagement by DoT.
In the total loss, the auditor saw maximum high financial impact of Rs 520.79 crore on the government exchequer due to non-withdrawal of spectrum from BSNL which the state-run firm had offered to surrender to avoid one-time spectrum charge.
CAG computed an annual loss of Rs 30.92 crore from making provision of guard band in 1800 MHz band (earlier known as 2G spectrum) that resulted in non-utilisation of 4.4 MHz in the band. It also found that DoT applied old formula collect spectrum charges from microwave access and microwave backhaul spectrum, and satellite spectrum allocated for national long distance and international long distance networks instead of revenue share basis which became a rule after the New Telecom Policy 1999 was put in place.