Road forward

Sibal starts work on fixing the 2G mess,but theres a way to go still

Telecom Minister Kapil Sibal appears to have come around to the right way of thinking. On Saturday,he announced the broad details of the new policy for telecommunications spectrum that is being drawn up by the government,and said,in particular,that the age of free spectrum or spectrum bundled with a licence is over. The basis of the new plan,as Sibal laid it out,appears simple: a unified licence will be issued to operators,making them eligible to provide any of the many telecom services. The spectrum that the operator will need for whatever services it intends to provide will not come with the licence,however; the company will have to pay for that spectrum in what the minister assures us will be a market-driven process.

This is,of course,the simple principle that should have been followed from the beginning.

Instead policy arbitariness at various points caused the playing field to be far from fair,and has caused the exchequer to lose a great deal of money even though Sibal,on a previous occasion,argued eloquently that no money was lost. Regardless of that widely-disbelieved statement,though,it is nonetheless notable that Sibal is sticking to his guns as a well-known reformer and is beginning to push through what needs to be done to clean up this sector,and perhaps reverse some of the damage.

A reformist agenda,of course,should not stop here. Sibal has already indicated that he knows the direction in which his new ministry needs to go in order to clean up its act: moving quickly on those firms that benefited from A. Rajas lax regulation. A fortnight after assuming control last November,Sibal sent notices to 85 companies that the comptroller and auditor general had determined had gained licences while not even being eligible. The notices demanded the companies show good cause,within 60 days,as to why their licences not be cancelled. The necessary next step is to work on extending that investigation to the other beneficiaries of Rajas decisions. And also to ensure that all the firms who got 157 licences from Raja,including the 85 already put on notice,either pay a market-determined rate for the spectrum they received or have their licences cancelled,so that their spectrum can be re-assigned,again at a market-linked price.