DoT sets norms for bidding

This forms part of the blueprint being prepared by the DoT to seek formal approval from the Cabinet for a fresh round of bidding for the basic circles where privatisation of telephone communication services is yet to be initiated.

For the circles which have already been awarded – Madhya Pradesh to Bharti, AP to Tatas, Gujarat to Reliance, Rajasthan to Shyam Telecom, Punjab to Essar and Bihar to Techno Telecom – the legal wing of the DoT has opined that switching over to the revenue sharing formula may bedifficult unless it can be proved that the benefits accruing to the Government through revenue sharing would assuredly be at least equal to if not higher than the money the Govt would have received through licence fees. "If this is not ensured, the Government could run into trouble for having caused losses to the central exchequer and not protecting the Govt’s interests," says a senior official of the DoT.

The blueprint being finalised by the DoT is also likely to include sending for bidding the three circles which had originally been won by Himachal Futuristic Communications Ltd (HFCL) but subsequently they decided they did not want to set up networks in these states. These will include Delhi, Uttar Pradesh (east) and Orissa. The Haryana circle, according to views expressed by the legal wing of the DoT, though still under litigation, cannot be tendered as the DoT has had some correspondence with HFCL and the company has expressed its desire to set up networks in this circle while expressing clearly that itwas not interested in the other three circles.

"Until this correspondence is concluded, it may be legally incorrect to auction this circle, " says a senior official. Even the Tamil Nadu circle, is likely to be included for rebidding in this round. The CII, Association of Basic Telecom Operators and COAI have all represented to the DoT with their own recommendations to be included in this round of tendering.