Raja faces flak on spectrum issue; Opposition walks out

Facing attack from Opposition which alleged "monumental scam" in the spectrum allocation, Telecom Minister A Raja today threw the ball in the court of regulator Telecom Regulatory Authority of India (Trai) to revisit the entry fee for telecom licenses.

In his nearly two-hour reply to the debate on the functioning of his ministry in the Rajya Sabha, Raja took shelter in the Trai guidelines at different times for the entry fee for the telecom license costing Rs 1,651 crore along with spectrum in 2007.

However, a dissatisfied united Opposition including BJP and Left parties demanding a Joint Parliamentary probe, staged walkout.

Raja who skirted the demand for JPC, said Trai is a statutory body and it was for it to revisit the entry fee.

Defending the policy of giving licenses without auctioning spectrum, Raja said the rules have resulted in higher tele-density and huge revenue for the government.

"We have so far collected Rs 68,000 crore. In 2007-08 alone the government got Rs 23,000 crore," he said.

However Leader of Opposition Arun Jaitley accused him of "skirting core issue" whether the Rs 1,651 crore license fee was a fair value and described the episode as "huge monumental scam" before leading a walk out.

Last year, Unitech and Swan — after bagging the licenses for Rs 1,651 crore each — sold stakes to foreign partners at huge premium. Unitech sold 67 per cent for Rs 6,120 crore to Norway's Telenor leading to an outcry over alleged under-valuation of radio frequency.

Raja said TRAI in 2001 had recommended that entry fee for telecom licenses should be nominal and subsequently raised the revenue share to 10 per cent based on increased subscriber base but did not hike the entry fee from Rs 1651 crore.

"If TRAI tomorrow comes with a new entry fee, we will have no problem. It can suo motu look into the hike in the entry fee", he said.

To this, Jaitley said TRAI in 2007 said the entry fee decided in 2001 did not determine the realistic value of the spectrum and needed to be linked to market mechanism.

Raja admitted TRAI has suggested this but maintained that its recommendations were broadly based on affordability and increasing tele-density which would not have been possible by auction of spectrum.

He said before 1999, telecom licenses were auctioned and led to huge loss by the private players who bid very high and could not get subscribers to sustain it. Later Government had to come out with revenue-share policy.

On the issue of Government rolling back the date of inviting applications for telecom licenses, Raja said the reason behind fixing September 25, 2007 as the cut-off date after seeking applications till October 1, 2007 was to have "reasonable restrictions on the huge flow of applications".

Defending his decision to grant licenses under the FCFS (First-Come-First-Serve) basis, he said under this policy 51 licenses were issued when Arun Shourie and Dayanidhi Maran were telecom ministers.