Spectrum refarming: Montek asks for more talks between Trai & Govt

New Delhi: Planning Commission Deputy Chairman Montek Singh Ahluwalia has asked the government to do more consultations with telecom regulator Trai before asking firms like Airtel and Vodafone to give up their existing spectrum and buy less-efficient airwaves.

An Empowered Group of Ministers headed by Finance Minister P Chidambaram on October 18 deferred a decision on the contentious spectrum refarming issue. Ahluwalia, who is part of the EGoM, on October 23 wrote to all other members of the grouping saying there was a need for more thorough analysis on the issue keeping in mind the need to minimise disruption.

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Telecom Commission (TC), the highest decision making body of Department of Telecom (DoT), has recommended that mobile phone firms give up all their spectrum/airwave holdings in more efficient 900 mega hertz band when their permits come up for renewal starting November 2014.

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The telecom operators can bid for the airwaves in an auction next year, or can buy replacement airwaves in the less efficient 1800 MHz band, the TC headed by Telecom Secretary R Chandrasekhar had recommended on October 17.

The GSM industry body COAI has said full refarming in 900 MHz band will make investments of over Rs 150,000 crore redundant.

Montek said TC has “never considered a detailed paper with full information indicating what is the best methodology for refarming.”

The commission considered the three alternatives and chose option 1 which calls for refarming of all spectrum as it was recommended by both Trai and DoT committee. “The views of DoT on the three options were not indicated nor was there an analysis of pros and cons,” the letter said.

Montek added that this suggests there is no clear roadmap for reallocating 900 MHz from the existing operators whose licences are coming up for renewal between 2014-16. “While the forthcoming auction will discover a price for 1800 MHz, there is no market discovered price for 900 MHz as yet,” he said.

Licences that are due to expire between 2014-16 along with the licences of BSNL and MTNL account for 84 percent of the total 900 MHz spectrum. “We should have a clearer view of what is going to be done with 900 MHz spectrum after the licences have been offered the 1800 MHz spectrum at the discovered price,” the letter said.

“For example, will the 900 MHz spectrum be auctioned allowing the existing holders to bid for it or will they have to accept the 1800 MHz alternative and wait whenever the 900 MHz is finally auctioned,” it added.

PTI