The reforms models

The New Zealand experience
In 1987, the New Zealand Post Office was corporatised, leading to the creation of Telecom NZ like our BSNL, and the separation of regulatory and policy functions. All restrictions on entry were lifted with effect from April 1989. Telecom NZ, after an extensive restructuring in which thousands of jobs were lost, costs cut and outdated systems replaced, was sold to a consortium led by Ameritech and Bell Atlantic of the US the following year. More players come in, led by Clear and Telstra.

Privatisation with phased competition

Countries: European Union, Japan, Hong Kong, Australia, Brazil
The UK experience
The UK was the second OECD country, after the US, to liberalise its telecom sector, starting 1980. The following year, British Telecom BT was separated from the post office. In line with its duopoly policy, UK gave the second fixed-line licence to Mercury Communications in 1982. In 1985, two licences were given for mobile services. Gradually, from 1990 onwards, UK had to take into account EU directives, and bilateral and WTO agreements. The duopoly policy was abolished in 1991.

Private participation without privatisation or liberalisation

Countries: China, Saudi Arabia
The China experience
In the past decade, the Chinese telecom industry has morphed from a state-run monopoly to a state-run oligopoly. Till 1994, the Ministry of Posts and Telecommunications provided telecom services through its operational arm, China Telecom. Under pressure from other ministries and irate customers, China introduced a second operator, China Unicom, which failed to compete with the giant, China Telecom. Following a ministerial reorganisation in 1998, the inefficient China Telecom was split into three companies fixed line, mobile and satellite. In 2002, the fixed-line company was further divided on a geographical basis. The ministry of railways also has a telecom arm. Following China8217;s entry to the WTO in 2001, a new regulatory regime is now being established and foreign operators are gradually being allowed access.