Jayachandran/Mint

Jayachandran/Mint

Ourview | The great disconnect

Ourview | The great disconnect

In the span of a week, the Supreme Court has passed two orders that have significantly strengthened efforts to investigate and prosecute the corrupt. They have given teeth to the Central Vigilance Commission, freed the Central Bureau of Investigation from reporting to the government on key cases, and empowered even an ordinary citizen to initiate action against the corrupt.

Jayachandran/Mint

The government, which doesn’t have money, will have to figure out how it is going to pay out a substantial sum of money to the telcos whose licences have been cancelled. This is, of course, subsequent to, and contingent on what Trai recommends. There’s also the possibility of some of the telcos whose licences have been scrapped taking the government to court.

The telecom market, and the financial environment now are not as hot as they were in 2007 and the first half of 2008. This means that any reauctioning will see limited interest (but it will see interest alright). It also means we could see tariffs rising—significantly in some markets. So, expect a bigger phone bill.

There is, of course, the matter of dealing with the on-ground assets of telcos whose licences have been scrapped (Trai will decide on this), and the loans on the books of banks that have loaned money to these telcos. Issues such as these—I am sure there will be more—will add to the complexity involved in implementing the court’s judgement.

The court’s ruling on Thursday also shows that it is convinced that there has been wrongdoing in the allotment of licences to telcos in 2008. Interestingly, the main case regarding this is being heard in a special court. Will that court now go against the subtext of the apex court’s ruling? Or is that judgement now merely a formality?

Is India’s telecom sector staring at an uncertain future? Tell us at views@livemint.com

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