Level the telecom field: Tata

Tata group chairman Ratan Tata has lambasted the govt for protecting BSNL.

Tata group Chairman Ratan Tata today criticised the government for protecting state-owned Bharat Sanchar Nigam (BSNL) and treating VSNL like a step child despite the opening up of the telecom sector.

Addressing VSNL shareholders at the company's annual general meeting here, Tata said the government was not providing a "fair level playing ground" to the competition.

"By protecting the incumbent, the government has made a mockery of privatisation. Even after disinvestment, the government continues to hold 26 per cent in VSNL."

However, the government was treating VSNL like a step child, Tata said. "By not providing a level-playing field for the competition, VSNL's value is going down. The government is hurting itself since it is the other largest shareholder in VSNL besides the Tatas," he said.

After losing its monopoly in international long-distance (ILD) services and with telecom tariff rates declining sharply, the company has been reinventing itself.

"In view of the competitive environment and decline in revenues in the telecommunications industry in general, we need to re-invent ourselves," Tata said.

In the process, VSNL is now focusing on broadband initiatives and will roll out broadband services in more cities across the country. Tata claimed that the company expected revenues from broadband to be in the range of Rs 300-350 crore.

However, he refused to say when revenues of this order were expected. Answering a shareholder's question on the golden share sought by the government, Tata said the "issue will be settled with the new government".

Tata is also in talks with the government on surplus land owned by the telecom giant. "There are certain legal issues like who will pay the stamp duty, gains to be shared by the previous shareholder and not the strategic partner who bought VSNL and so on. We are in talks with the government to resolve these legal issues," he said.

Tata claimed that the earlier government had agreed to refer the matter to arbitration and "we are taking this up even with the new government".