“I have been saying this repeatedly that the impact of the judgement is far-reaching. It has implications not only on the (telecom) sector but on other sectors as well,” Sibal told PTI.
The apex court, cancelling licences allocated by the then Telecom Minister A Raja, had stated that auction was the best way for allocation of scarce natural resources. The court had also defined natural resources as both renewable and non-renewable.
Sibal added that the government is studying the implications of the judgement and would take a view on the way how it should proceed.
“We will do that. As and when we do that, we take that decision, it will be placed in public domain,” he said.
Sibal cited example of the Mines and Minerals Regulation and Development Act that governs mineral resources in the country and auction of these resources can pose challenges.
“Suppose we want to mine a particular mineral and we find that for the prospecting of that mineral because you don't know what are the quantities of that mineral embedded in earth and you don't know where it is embedded so naturally you will request entrepreneurs to come and prospect,” Sibal said.
After entrepreneurs spend $600 million on prospecting, and find the mineral, should it be the policy to auction it. These are the questions which need to be looked into, he said. Telecom Minister said that the Supreme Court judgement would have impact on the future of investments in the country.
“We have to study all those things and then come to a considered view as to what extent it will impact and how we have to deal with it. So, we have not taken a position on it but these are all issues that need to be addressed,” Sibal said.
Early this month, the Supreme Court in its judgement on cancellation of 122 2G telecom licenses severely criticised first-come-first served (FCFS) policy that was used to grant these licences.
The Supreme Court in its judgement said natural resources must be awarded through a public auction to maintain transparency and not through such (FCFS) flawed process.
“There is a fundamental flaw in the principle of first-come first-served in as much as it involves an element of pure chance or accident. In matters involving award of contracts or grant of licence or permission to use public property, the invocation of first-come-first-served principle has inherently dangerous implications,” the judgement said.
The judgement said that in “alienation” of scarce natural resources like spectrum etc, the state must always adopt a method of auction by giving wide publicity so that all eligible persons may participate in the process.
“Any other methodology for disposal of public property and natural resources/national assets is likely to be misused by unscrupulous people who are only interested in garnering maximum financial benefit and have no respect for the constitutional ethos and values,” it had said.
These cancelled licences belonged to Uninor (joint venture between Unitech and Telenor of Norway), Loop Telecom, Sistema Shyam (joint venture between Shyam and Sistema of Russia), Etisalat DB (joint venture between Swan and Etisalat of UAE), S Tel, Videocon, Tatas and Idea.
With cancellation of these licences, the government has over 536 Mhz spectrum for auction.
The apex court had directed the Government to seek fresh recommendations from Trai on allocation of licences and spectrum by way of auction.
New telecom policy likely to be cleared by April end
The Department of Telecom has chalked out a timetable for implementation of new telecom policy -- NTP2011 -- according to which it would be cleared by the end of April this year.
The draft Cabinet note of new telecom policy, which is envisaged to bring in transparency and clarity in the telecom sector, is expected to be circulated to concerned Ministries by tomorrow, to which the responses are expected by March 6.
As per the presentation made by the Department of Telecom (DoT) to Prime Minister Manmohan Singh and senior ministers, the draft note is expected to reach the Cabinet for consideration by March 21 and a final decision was expected by end of April this year.
Under the proposed regulations, operators would be allowed to hold higher spectrum of up to 8 MHz (except Delhi and Mumbai where the upper limit would be 10 MHz) and pay a uniform licence fee of 8 per cent, the presentation said.
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