Trai simply watching telecom sector collapse: FinMin official

A key finance ministry official, who did not wish to be named, on Tuesday said the telecom regulator is not doing its job properly and the collapse of the sector may add to the non-performing assets (NPAs) in the banking system.

“The Telecom Regulatory Authority of India is not passing any order and simply watching the system collapse,” the official said.

The higher provisioning requirement, which the Reserve Bank of India has announced, had to happen, he said. 

“In telecom, the race to the bottom (price war) is going on,” the official said. 

He said the system was completely losing faith in the “unelected” regulators. 

Allowing a new company to come out with promotional offers once is alright, but you cannot allow a system to lead to a collapse of the entire sector that would increase the banks NPAs, he added.