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Friday, May 14, 2010

Idea joins war against telecom ministry

The Aditya Birla group’s Idea Cellular became the third major operator to criticise the government’s telecom policy on Thursday, stating that telecom policies smack of “crony capitalism.” The statement comes in the wake of reports of increased lobbying by GSM operators, including Bharti Airtel and Vodafone Essar, seeking the removal of telecom minister A Raja.

Idea’s statement seemed to anticipate such a change. “For too long, the telecom sector policy has variously displayed characteristics of quota raj, license permit raj and an SSI mindset, conveying unfortunately impressions of crony capitalism. The sector and the nation deserve a new deal. We expect the government to seize the moment,” it said.

Interestingly, industry sources said both the Anil Ambani and Tata groups are known to be indifferent or even slightly supportive of Raja.“Tatas did not not get spectrum in 3 circles for many years during the time of Dayanidhi Maran.. At least during Raja’s time, things do get done, if not as fast as they should be,” said a person close to the Tata group, requesting anony -mity.

However, the Tata group too feels ‘neglected’ under the current regime.Sources point out that while Ambani and Tata were supposed to be on the same eligibility level for GSM spectrum, Tata is yet to get GSM spectrum in many cities such as Delhi, Ahmedabad and Patna.

Meanwhile, operators also complained of the ongoing blockade of Chinese equipment in the name of ‘security concerns’, pointing out that the different levies are pushing them up against the wall.

According to sources, nearly all the operators, including Bharti and Tata, have written to the home ministry over the last three months seeking details of the so-called tests that the equipment has failed.“They are not giving any details. All they keep saying is ‘national security’,” complained an official with one of the affected operators.

“If they want us buy from European firms, it won’t solve any of the problems because their equipment is also made in China,” the official, who wished to remain anonymous due to the sensitivity of the topic, added.

The official added that a switch-over from the Chinese vendors to European vendors can “almost double” the equipment-related capital expenditure.It is expected that each operator will have to invest close to a billion dollars (Rs 4,500 crore) to deploy a 3G network after the auctions are over.

Meanwhile, Chinese equipment vendor ZTE met the home secretary G K Pillai along with the Chinese ambassador. “We had a meeting. Talks are going on. We have appealed to the government. We have put forward our thoughts. Let’s see,” D K Ghosh, ZTE India head, said after the meeting which lasted for about half an hour. “The talks were held in a positive environment,” he said, when asked whether he was happy with the talks.

Later in the day Chinese Ambassador to India Zhang Yan also met Pillai. Emerging from the nearly 45-minute meeting, Zhang told mediapersons that “we had a very good discussion. It was a positive meeting. I hope all relevant issues will be resolved.”

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