The BJP on Tuesday expressed ‘dismay’ at the proposed steep reduction in Spectrum Reserve Price and Spectrum Usage Charges by the TRAI and feared it would favour few operators at the cost of the national exchequer.
In a letter to Prime Minister Manmohan Singh, senior BJP leader Yashwant Sinha stated that with the new reserved price and the amount of spectrum intended to be auctioned, the ‘potential loss to the Government could be as high as Rs 35000 crore’. He demanded that the TRAI’s recommendations with respect to reserve price and SUC be rejected immediately.
As per the TRAI recommendations, the reserve price for 1 MHz of spectrum of Pan-India basis in 1800 MHz band has been reduced from Rs 2376 crore to Rs 1496 crore or by 37 per cent. In case of key circles like Mumbai and Delhi, this reduction is much steeper at more than 50 per cent. Similalry for spectrum in 900 MHz band, TRAI has proposed reduction in reserve price in 3 Metro Service Areas by almost 62 per cent - from Rs 1718 crore to Rs 650 crore for block of 1 MHz Spectrum.
“These recommendations contradict TRAI’s own argument and approach adopted while recommending spectrum reserve price for previously held auctions. last year, TRAI had defended and justified the reserve price of Rs 3622 crore for Pan India 1 MHz spectrum in 1800 MHz band with a detailed reasoning and economic logic. It also proved through detailed calculation that the impact that the recommended reserve price on telecom tariff to subscriber would be negligible,” Sinha wrote in his letter to the PM.
He further wrote, “I fail to understand why the same body now has junked its own recommendations within one year and has recommended such a steep reduction in the reserve price. This is not expected from a sector specialist regulator.”
The BJP leader refused to buy TRAI’s argument that steep reduction has been done for forthcoming auctions as the auctions held in November, 2012 and March, 2013 had been failures. Sinha said auctions had failed due to collusion and cartelisation of the incumbent operators and not high prices.
“I urge your office to take immediate remedial measures and in order to realise the true economic value of spectrum and to uphold the interest of Indian citizens and the revenue objectives of the Government, the recommendations of TRAI with respect to reserve price and SUC should be rejected forthwith,” Sinha demanded.