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Market forces should have determined 2G license fee: Trai

Market forces should have determined 2G license fee: Trai
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First Published: Fri, Nov 28 2008. 04 24 PM IST
Updated: Fri, Nov 28 2008. 04 24 PM IST
PTI
New Delhi: In the midst of a controversy over allotment of spectrum to new players, telecom regulator Trai today said that market forces should have determined the price of a licence, which includes start-up spectrum.
“We have said a mechanism should be evolved for licence giving which must capture the market price,” Trai Chairman Nripendra Mishra said adding “because the spectrum was bundled in the licence for 2G therefore separately it was not feasible to auction 2G spectrum so that the licence had to capture the market price of the spectrum.”
Asked whether DoT bypassed Trai’s recommendations for pricing the 2G licence, he said DoT had not sought regulator’s views on whether spectrum was to be auctioned or not.
He, however, said that Trai’s recommendations of August, 2007 needed to be looked at as an integrated document and not as an observations separately from the recommendations.
Mishra said that section 2.73 of its recommendations of 2007 state, “In today’s dynamism and unprecedented growth of telecom sector, the entry fee determined then (2001) is also not the realistic price for obtaining a licence. Perhaps it needs to be reassessed through a market mechanism.”
Mishra further said “Instead of making judgement who is right or wrong ... we should be really looking at if there is scope for getting more revenue for the national exchequer... if there is, is there a way we could find out.”
Telecom Minister A Raja has been saying he went on by Trai’s recommendations while giving licences and allotting spectrum, however the regulator claims it did not favour auction of 2G radio waves.
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First Published: Fri, Nov 28 2008. 04 24 PM IST