TRAI again

After the confusion and paralysis of the last few years, the least that was expected of the long awaited new telecom policy was that it w...

After the confusion and paralysis of the last few years, the least that was expected of the long awaited new telecom policy was that it would be clear-cut with no loose ends to cause further confusion, that it would be based on realistic assumptions and that it would settle once for all the tortuous and on-going dispute between the regulatory authority, TRAI, and the Department of Telecommunications.

The new policy has been announced as promised before the end of March and for that small mercy the country can be grateful. But on none of the essential requirements to break the current logjam in telecom growth and development does the new policy score very high. The most significant broad feature and one that will further the interests of consumers in the long run is the introduction of more competition in telecom services by allowing multiple operators in fixed and cellular services, by opening up domestic long-distance telephony to private operators by the year 2000, and by turning DoT into an independentcorporation by 2001.

The concept is good. But obstacles in the path to realising the vision of a truly competitive telecom environment remain. The major one of how existing basic and cellular licensees will be incorporated in the new policy framework is left relatively unattended. It remains to be seen how 8220;legally tenable8221; it will be to run a dual system, a licence-fee system for existing licensees and a revenue-sharing arrangement for new licensees in unoccupied circles; and whether the terms of existing contracts can be changed retrospectively because of policy change. Again, it is an open question how commercially viable it will be for existing licensees to pay exit penalties in order to take up the option of shifting in phases to revenue-sharing.

Without clarity on legal and contractual obligations, the government may well have jumped the gun in announcing its dual system policy.

The attempt to relieve TRAI of some more of its teeth comes as no surprise. If DoT8217;s long battle to deny theregulatory authority any real powers has proved anything, it is the abiding reluctance and inability of successive governments to set clear rules and then leave an independent body to ensure that they are observed. Under the new policy, TRAI can arbitrate but not adjudicate which means it can offer its good offices for what they are worth in settling disputes but disputes will eventually have to go to court. TRAI is bound to make recommendations on licensing but the government is not bound to accept them. This is like saying the regulatory authority must have a considered, defendable opinion but the government will be free to do the indefensible. Turf battles are unlikely to end with the new policy not only because of TRAI8217;s known propensity to take its quarrels with DoT to court but because the courts are even now hearing matters vital to TRAI8217;s future role. Unresolved territorial questions here hardly make for the prospect of healthy development of the telecom sector. All good policy is forward looking andthe new telecom policy does look ahead. What it fails to see is the large potholes at its feet.