The Telecom Regulatory Authority of India (Trai) has recommended that the government cancels 38 telecom licences in the wake of the 2G scam.
The companies impacted by that proposal and the number of licences cancelled are: Aircel (1); Dishnet Wireless…
The Telecom Regulatory Authority of India (Trai) has recommended that the government cancels 38 telecom licences in the wake of the 2G scam.
The companies impacted by that proposal and the number of licences cancelled are: Aircel (1); Dishnet Wireless (3); Etisalat DB (2); Loop Telecom (14); Sistema Shyam Teleservices (10) and Unitech Wireless (8).
Junior Telecoms Minister Sachin Pilot also told lawmakers in the upper house of parliament that Trai proposed legal examination of 31 licences given to Aircel (1), Allianz Infratech (2), Etisalat DB (11), Loop Telecom (6), Sistema Shyam Teleservices 91) and Videocon Telecommunications (10). The examination could lead to further cancellations.
In November, Trai proposed cancelling the 2G licences of several new entrants, after months of controversy around the allocation of underpriced 2G spectrum in 2008 and allegations of favouritism that claimed the head of former telecom minister A. Raja.
This followed a report from the Comptroller and Auditor General of India (CAG), the government’s auditor, which claimed that the 2G scam caused a Rs1.76trn (US$40bn) loss to the government, after licences were sold to mobile operators based on a price determined in 2001.
Trai also reportedly argued that the companies did not meet their roll-out obligations, which include covering at least 10% of the district headquarters by the end of the first year of receiving licences, or did not fulfil certain eligibility requirements – such as meeting share capital minimums.
“The government is currently facing intense pressure to take some steps in the 2G scam. There are many suggestions, including imposing fines, revoking the licences, or getting compensated for the loss etc, and it’s really difficult to say what the final decision will be. But for now it’s really a question of wait and see,” Ravishankar Raghavan, a principal in the Tax Group at Indian law firm Majmudar, told TelecomFinance a few weeks ago.
Last week, telecoms minister Kapil Sibal said that the ministry will soon be sending notices to the companies asking them to explain why their licences should not be cancelled. From reception of the letters, the companies will be given two months to respond.
