2G licences issued from 2004 to 2007: Govt could have earned Rs 28k cr more

The government could have earned an additional revenue of around Rs 28,000 crore if the Department of Telecommunications (DoT) had issued 51 new licences between 2004 and 2007 at rates which have been determined by the recent Comptroller and Auditor General (CAG) report.

CAG has calculated the loss of revenue to the exchequer in selling the new 2G licence to new operators at the same price as the 3G auction. However, the 51 older licences were also issued at 2001 prices.

According to available figures, DoT had issued the 51 licences to players like Aircel, Bharti Airtel, Vodafone Essar and Reliance Communications, among others, at Rs 1,651 crore for pan-India, which was fixed in 2001. However, the CAG report has not talked about the possible loss to the exchequer due to issuance of these licences issued in 2004-07, though the period of audit covers this timeframe.

On the basis of the 3G auction price, the government could have earned an additional Rs 27,908 crore from the issuance of 2G licences, while it got only Rs 2,218 crore. However, while it might be unconcievable to expect the licensees to pay the 3G price so many years ago for 2G, the revenue it could earn depending on what formula is used could have been substantial for the government.

Even if the other formulas of CAG are used, the government could have earned additional revenues between Rs 8,000 crore and Rs 10,000 crore from the licences.

The government had earned around Rs 67,000 crore from the auction of 3G spectrum held in May.

In its latest report, CAG had said the licences issued in 2008, at the price fixed in 2001, had caused a revenues loss of Rs 1.76 lakh crore to the exchequer, based on the 3G price.

It had also said that about 85 out of the 122 new licences issued were ineligible. The new licences in 2008 include Unitech (Uninor), Datacom (Videocon), Swan Telecom (Etisalat DB) and Loop Telecom, among others.

DoT has already said the department would look into all issues raised by the CAG report and also the licences issued before 2008.

“We will soon look into the issue raised in the CAG report of ineligibility of various new players who were issued licences in 2008. After determining the actual position, we will take action, if warranted,” a senior official from DoT said.