3G issue back to an EGoM, after Antony's no-further letter

With growing differences coming up again between the defence and telecom ministries over vacation of third generation (3G) spectrum, the government has decided to refer the issue before an empowered group of ministers (EGoM).

The progress on the vacation of spectrum, including implementation of the earlier memorandum of understanding (MoU) signed between the defence and telecom ministry and vacation of 3G spectrum will now be placed before the eGoM, says a directive from the cabinet secretariat. It says there are areas of disasgreements despite the decisions of a high-level monotoring committee set up to oversee implementation of the MoU.

The move follows a letter a few days earlier from defence minister A K Antony to finance minister Pranab Mukherjee that his ministry would not release any more spectrum for telecom operators in both 2G and 3G if the telecom and finance ministries did not implement their end of the terms agreed in the MoU.

Under the MoU, signed two years earlier, the defence ministry had agreed to vacate 25 MHz of spectrum in the 3G band and 20 MHz in the 2G band, in phases. In return, the Department of Telecommunications (DoT) had committed to set up an exclusive defence band and defence interest zone for the armed forces.

DoT was to also commission an optic fibre cable (OFC) network at a cost of Rs 10,000 crore, by Bharat Sanchar Nigam Ltd, for the defence services. Also, the finance ministry was to waive the spectrum fee of around Rs 10,000 crore payable by the defence ministry.

The defence ministry has already vacated 15 MHz of 3G spectrum. This was auctioned last year and earned the government huge revenues. It has also vacated 15 MHz of 2G spectrum, which has been allocated to new operators.

Under the agreement, the remaining spectrum — 10 MHz spectrum in 3G (for two operators) and 5MHz in 2G — is be vacated only after the OFC network is complete. This was slated for 2012.

However, Antony told Mukherjee, the DoT had not met a single commitment even after the matter was taken to a monitoring committee chaired by the cabinet secretary. Also, the finance ministry had yet to waive the Rs 10,000-crore spectrum charge, despite the issue having been taken up on several occasions.