Defence may foot the bill for dedicated telecom network

The government is actively considering asking the Defence Ministry to fund the setting up of a dedicated communication network for the armed forces in lieu of the 3G spectrum released by it. The Defence Ministry,it is felt,has the capacity to absorb the huge expenditure of Rs 8,000 crore required to roll out the network over the next three years.

While the Defence Ministry has been sounded out over the new proposal,its Minister A K Antony indicated at a meeting of the Empowered Group of Ministers,headed by Finance Minister Pranab Mukherjee,that he would follow the memorandum of understanding with the Telecom Ministry in letter and spirit. The MoU requires the Telecom Ministry to fund the armed forces network.

Given the fact that the Defence Budget in the past years has not been fully utilised due to delays in hardware acquisition and funds have been either parked or surrendered,the Finance Ministry is of the view that the Defence Ministry take care of the network expenditure costs for now.

The Defence Ministry can be suitably compensated from the 3G revenues generated by the Telecom Ministry from the planned auction next month. The government expects Rs 30,000 crore from the 3G spectrum auction. The total Plan size of the Telecom Ministry last year was just Rs 431 crore and the demand for the next budget is Rs 2,052 crore,indicating the paucity of resources to fund the network for the armed forces.