Speaking at FICCI’s Safer Internet Initiative Shri Singh said, “Only laws will not be enough. This will require joint efforts by the industry, civil society and together it can be achieved. Awareness creation is necessary amongst stakeholders.” Themed “Together for a Safer and Better Internet”, the event was organised by FICCI, supported by UN Women and TikTok.

Shri Abhishek Singh highlighted that the government is taking a series of steps to ensure that government digital systems are safe and secure. “This would require building secure systems, ensuring right audits are done, and public data handling systems are made as secure as possible,” he added.

Shri Singh also laid special emphasis on cyber training of the government officials and said that government has already launched ‘Cyber Surakshit Bharat Scheme’ to impart trainings to officials. “Under this program, almost 600 govt officials are already trained and there is plan of training another 600 officials to ensure all government departments wherever their services are being offered are handled in a much safer and better way. An online course for training 1000 police personnel in Cyber Law & Cyber Forensics is being launched in partnership with NLIU Bhopal.,” he added.

Dr. Subi Chaturvedi, Head - TikTok For Good India during the session stated "TikTok For Good is our long-term commitment to contribute to the larger social betterment. As internet penetration continues to grow at a rapid pace across India, there is a need to sensitize and educate “people about responsible online behaviour for their own safety. As part of this we look to work continuously with all stakeholders, be it the Government, Industry, Academia and civil-society, to a common goal of moving together for a better Internet”

Ms Nishtha Satyam, Deputy Country Representative, UN Women, said “Online safety involves a host of stakeholders to work together to build a safe and secure environment especially for women.”

“FICCI is committed and will be delighted to work with Government of India, Industry and other stakeholders for the development of safer internet ecosystem in India” said Chairman, FICCI ICT and Digital Economy Committee.

The Telecom Regulatory Authority of India (Trai) on Thursday said it will bring out in the next few weeks its order on the revised quality of service norms for mobile services, including benchmarks for newer technologies like VoLTE. “On quality of service norms and parameters, on how to redefine them, what should be the values, the granularity... should the call quality be measured at the level of service area, or towers, or district... on all those issues, we had held consultations and we will take a decision in a few weeks,” said Trai chairman R.S. Sharma, who was speaking to reporters on the sidelines of a FICCI event.

Google's Chief Internet Evangelist Vinton Cerf on Tuesday discussed with Communications Minister Ravi Shankar Prasad the role the US-based tech giant can play in the government's Digital India programme. They also discussed ways to increase Internet penetration.

"It is in a very early stage of discussion. Google is interested in being helpful. We want to share with them (government) ideas to find out which of them makes sense. May be, they will have better ideas than us," Cerf told reporters on the sidelines of a FICCI event.

"It is very clear that the private sector is going to have to play a major role, but it won't work unless basic infrastructure that government proposes to bring in is out into place," he said.

According to sources, the discussions revolved around increasing Internet penetration, helping small and medium businesses harness its potential and bringing more women online.

Widely known as the “Father of the Internet”, Vinton G. Cerf co-designed with Robert Kahn the protocols and basic architecture of the Internet. Currently, he serves as chief Internet evangelist at Google Inc. He was in New Delhi on Tuesday to talk at an event organized by industry body Federation of Indian Chambers of Commerce and Industry on innovation, jobs, the Internet and the Digital India programme, and met telecom minister Ravi Shankar Prasad before the event . In an interview on the sidelines of the event, he talked about the evolving architecture of the Internet, future trends, and security and privacy concerns that have plagued the Internet. Edited excerpts:

On the need to overhaul Internet’s architecture

The first thing to observe is that the basic architecture of the Internet has remained relatively stable over the 40 years. On the other hand, it has been evolving, the details have been changing. Moving from IPv4 to IPv6 (Internet Protocol version 4 to version 6) is different address formats. Another thing which wasn’t a part of original architecture and was added later was the firewall. Third thing was network address translation, a way of trying to share the IPv4 address space out because there wasn’t enough of it, which is actually harmful. We did not know in 1973 that 4.3 billion terminations were not going to be enough for Internet. By 1996, the standard’s group managed to figure out we needed standardized IPv6. So those kinds of things have all evolved.

Domain name system security is another example where we started out with very trusting and safe environment and now of course it is a part of a global and public system, and we have bad guys out there causing trouble. So we use cryptography for the domain name system for protection and confidentiality as we do it at Google.

There is still more to be done. We don’t handle mobility as well as we should. There is not any broadcast mechanism right now, there is a multicast, but no explicit use of radio broadcast capability. We should use the capability of radio, which has the ability for one transmitter to reach multiple receivers, and our protocols do not explicitly do that, they could.

There are a bunch of other things that could be done, and I want students, professors, researchers and private sector to feel free to explore new ways of enhancing Internet service. The most recent evolution is called open flow, which was also developed at Stanford University where I did my original work. The open-flow design is an innovative idea, where basically they said why should we be constrained by using just the bits in the address space for packets to figure out how to route them. What about other bits in the package? Could we use those to help us decide which way this packet should go where—so they broke that limitation, then they created a separation of a data point and control point which increased reliability and security in the system.

Google recognized this open flow, put it in our backbone network, and we are operating that way. This is another example of the continued ability of the Internet architecture to ingest new ideas and allow people to experiment. Over the course of years, a whole bunch of real-time protocols have been developed... New applications have been implemented, so there is no end in sight. There is an opportunity to keep inventing and reinventing this architecture and the way in which it works.

On security and privacy

Certainly one of the things that have to happen is that we need to develop better operating systems and browsers that are more resistant to some of these problems. Google is doing that. There are Android and Chrome, for example, and others are pursuing that. We are using cryptography for stronger authentication to keep people from highjacking your network and resources. We need to teach people how to be more aware of what their risks are, just like we tell children to not get into strangers’ cars. We need software that will help us detect problems in our configuration. We need browsers that are more conscious of the possibility of the malware.

On future trends

A lot of devices that are programmable and have capability are becoming part of the Internet environment. The first thing is the device can keep ingesting and gain new functionality, which means without changing the physical device, you increase its utility by making it do more things. A really good example is Tesla cars. Frankly, it is all software. They keep downloading new software every night to do new things—and that is the perfect example in the context of the Internet of Things. It keeps adding to its functionality based on programmers’ new ideas. So that is going to continue as a trend.

The other thing is increased use of mobile operation, increased use of radio, increased sharing of radio spectrum, different kinds of ways to allow multiple modulation schemes to coexist in the same frequency band—which you need to get more utility out of the radio spectrum.

The system is going off the planet, there is interplanetary extension already in operation, that will continue. There is even a project right now to design a spacecraft to go to a star in 100 years’ time, and my problem is how do you communicate over the light year distance—haven’t solved that problem yet (laughs)…so what I foresee is a continuing evolution of both network technologies and application space.

You can see what happened to mobiles. As soon as they become smartphones, they become a platform for new applications to be built at. All of this is very refreshing and it isn’t over yet.

Google's Chief Internet Evangelist Vinton Cerf on Tuesday discussed with Communications Minister Ravi Shankar Prasad the role the US-based tech giant can play in the government's Digital India programme.

They also discussed ways to increase Internet penetration in the country.

"It is in a very early stage of discussion. Google is interested in being helpful. We have some ideas. We want to share with them (government) those ideas to find out which of them makes sense. May be, they will have better ideas than us," Cerf told reporters on the sidelines of a FICCI event. "It is very clear that private sector is going to have to play a major role, but it won't work unless basic infrastructure that government proposes to bring in is out into place," he said. According to sources, the discussions revolved around increasing Internet penetration in the country, helping small and medium businesses harness its potential and bringing more women online.

They added that Google is also keen on playing a larger role in the government's Digital India initiative.

In August last year, the government approved an umbrella programme, Digital India, comprising various projects worth over Rs 1 lakh crore to transform the country into a digitally empowered knowledge economy. The programme includes projects that aim to ensure that government services are available to citizens electronically and people get benefit of the latest information and communication technology.

Industry chamber FICCI today welcomed Attorney General Mukul Rohatgi asking the Income Tax Department not to file an appeal against the Bombay High Court judgement in the transfer pricing case of Vodafone.

"FICCI welcomes the decision of the government not to appeal against the judgement relating to the transfer pricing tax issue involving Vodafone," FICCI President Sidharth Birla said in a statement.

Attorney General Mukul Rohatgi said that he has asked the Income Tax Department to desist from filing appeal against the Bombay High Court ruling that Vodafone is not liable to pay an income tax demand of Rs 3,200 crore in a case relating to transfer pricing.

"FICCI had earlier suggested that the detailed judgement of the Bombay High Court must be allowed to remain conclusive. The exhaustive interpretations and conclusions therein set the ground for avoiding needless disputes in respect of such capital raising, and can help resolve multiple litigations," Birla said.

The Attorney General said he was in agreement with the view taken by the CBDT Chairman in the matter.

"I have concurred with the view of the CBDT chairman," Rohatgi said.

His opinion comes in the backdrop of reports that the income tax department was keen on challenging the October 10 judgement of the High Court verdict.

The I-T Department had asked the company to pay additional income tax alleging that it had undervalued its shares in the subsidiary Vodafone India Services while transferring them to the parent company in Britain.

Transfer pricing is the practice of arm's length pricing for transactions between Group companies based in different countries to ensure a fair price -- one that would have been charged to an unrelated party - is levied.

Industry chamber FICCI today welcomed Attorney General Mukul Rohatgi asking the Income Tax Department not to file an appeal against the Bombay High Court judgement in the transfer pricing case of Vodafone.

"FICCI welcomes the decision of the government not to appeal against the judgement relating to the transfer pricing tax issue involving Vodafone," FICCI President Sidharth Birla said in a statement.

Attorney General Mukul Rohatgi said that he has asked the Income Tax Department to desist from filing appeal against the Bombay High Court ruling that Vodafone is not liable to pay an income tax demand of Rs 3,200 crore in a case relating to transfer pricing.

"FICCI had earlier suggested that the detailed judgement of the Bombay High Court must be allowed to remain conclusive. The exhaustive interpretations and conclusions therein set the ground for avoiding needless disputes in respect of such capital raising, and can help resolve multiple litigations," Birla said.

The Attorney General said he was in agreement with the view taken by the CBDT Chairman in the matter.

"I have concurred with the view of the CBDT chairman," Rohatgi said.

His opinion comes in the backdrop of reports that the income tax department was keen on challenging the October 10 judgement of the High Court verdict.

The I-T Department had asked the company to pay additional income tax alleging that it had undervalued its shares in the subsidiary Vodafone India Services while transferring them to the parent company in Britain.

Transfer pricing is the practice of arm's length pricing for transactions between Group companies based in different countries to ensure a fair price — one that would have been charged to an unrelated party — is levied.

Information technology is a big priority of the government and it is a matter that Prime Minister Narendra Modi is moving himself, Telecom and IT Minister Ravi Shankar Prasad said today. He said the Prime Minister has been taking presentations from all departments of governments, including his Ministry. "While this presentation was going on, the Prime Minister was sitting by my side. I said they want incentives. He asked what do you want, I said it has to be done. He just said okay and then I saw the budget. All my demands have been met," Prasad said. Prasad was speaking at i-bharat 2014 event organised by industry chamber FICCI.

The government will provide broadband connectivity to 225,000 gram panchayats, or village blocks, in the next three years, telecom secretary Rakesh Garg has said.

The move is part of the Narendra Modi-led government's "digital India" drive.

Garg said that while 500 village blocks are already connected through an optical fibre network, accessibility of broadband needs to be expanded as it is critical for the masses in rural and remote areas.

"Government has taken up National Fibre Optic Network (NOFN) project to connect 2.25 lakh gram panchayats in three years with 100 Mbps speed," Garg said at the 'i-Bharat 2014' event organized by FICCI on Friday.

Three PSUs— Bharat Sanchar Nigam Ltd (BSNL), Railtel and Power Grid Corporation of India (PGCIL)-- have been asked to survey 250,000 village blocks. Of this, 181,000 blocks have already received technical sanction.

In 2011, the UPA government had cleared a similar plan to link all gram panchayats through broadband but the project faced delays and missed the March 31, 2014 deadline. As part of the plan, a special purpose vehicle-- Broadband Network Ltd (BBNL)—had been set up to execute the Rs 21,000-crore initiative.

Garg said there is there ample scope for private sector participation in the broadband arena and that there is need for exploring how private players can leverage government-led infrastructure.

"Government is giving a lot of emphasis on broadband and the National Telecom Policy 2012 targets can be achieved by jointly working with the private sector," he said.

Last month, Telecom Minister Ravi Shankar Prasad had informed Parliament that the government would connect 50,000 gram pachayats by March 2015 and 100,000 by March 2016, subsequently meeting the target by March 2017.

Concerned over under-utilisation of broadband capacity, the government on Friday sought suggestions from the industry to enhance its usage that is at around 50 per cent level.

“Whatever infrastructure is available today in broadband, much of it is in government sector. Most of it is not being used. Hardly 50-60 per cent of capacity is being used,” Telecom Secretary Rakesh Garg said at i-Bharat event organised by industry body FICCI.

“We have to do lot of work even to make this benefit available to the people,” he said, inviting suggestions from industry to enhance the use of the broadband infrastructure.

“What private and government sector can jointly do to see how we can use most of it, where ever it has reached? At least, it has reached the block level,” Mr. Garg said.

He added that the government and other stakeholders have to find the reason for under-utilisation of broadband by the private sector “whether it is cost, speeds of connectivity or is it devices that are very costly”.

Mr. Garg said the government is working to connect all the 2.5 lakh panchayats with high speed broadband network but stakeholders need to ensure that the new infrastructure being laid is utilised by people in the rural areas.

“In coming three years all 2.5 lakh gram panchayat will be connected from their block headquarter with broadband which will give them speed of minimum 100 mbps (megabit per second).

If it reaches to villages and it is not used then its maintenance will be also very costly affair,” Mr. Garg said.

Department of Electronics and IT (DEITY) Joint Secretary Rajendra Kumar said the government is ready to provide infrastructure required to enhance utilisation but still for some reason initiatives have not achieved desired impact.

The government will expedite the National Optical Fibre Network (NOFN) project to connect 50,000 gram panchayats this year, IT and Teleommunications Minister Ravi Shankar Prasad said here Friday.

“A big revolution waiting to occur in the field of digital connectivity and once the government is able to create an enabling atmosphere, I am sure retailers, service providers, content creators will come on their own," addressing the "i-bharat 2014" conference organised by the Federation of Indian Chambers of Commerce and Industry (FICCI).

The previous government thought of it, but it was in limbo, he said. "We have decided that we shall reach 50,000 gram panchayats this year, 1 lakh next year and 1 lakh a year after that. This we are pursuing very very vigorously.”

The NOFN aims at providing broadband connectivity to 2.5 lakh gram panchayats in India.

Prasad also mentioned that the government is very keen that all the universities in India are wi-fi enabled and all the schools in India must have broadband connectivity.

“The stakeholders also need to work. The government and private sector can work in a more effective and enabling atmosphere for the spread of broadband,” he said.

“Let there be healthy competition, fair engagement, The government will do the entire architecture in a fair, non-discriminatory manner so that people get the biggest benefit.”

On the absence of major electronic manufacturing in the country, Prasad said: “Current import of electronics goods in India is $100 billion, which is likely to become $400 billion by 2020. The import duty is going to surpass the fuel duty.”

The minister emphasised that huge employment can be generated in India in electronics manufacturing sector.

Information technology is a big priority of the government and it is a matter that Prime Minister Narendra Modi is moving himself, Telecom and IT Minister Ravi Shankar Prasad said today.

He said the Prime Minister has been taking presentations from all departments of governments, including his Ministry.

"While this presentation was going on, the Prime Minister was sitting by my side. I said they want incentives. He asked what do you want, I said it has to be done. He just said okay and then I saw the budget. All my demands have been met," Prasad said.

He was speaking at i-bharat 2014 event organised by industry chamber FICCI.

The minister said he is pushing to increase electronics manufacturing in the country in order to reduce the rising import bill.

India is expected to be a USD 400-billion electronics market by 2020. In the absence of corrective measures, electronic import bill is likely to rise to USD 300 billion by then.

The minister said the push to electronic manufacturing and government decision to allow 49 per cent FDI in defence will work hand-in hand.

"Electronic manufacturing has a big component in the arms manufacturing as well. Therefore, the push as Minister for IT and Electronics in the field of electronic manufacturing and the push to native manufacturing sector by my leader, friend, elder brother Arun Jaitley in the defence, both are going to work hand-in-hand," Prasad said.

The electronic manufacturing is going to be the focus area for the new government besides conventional issues of e-kranti, connectivity etc, he said.

"One of the first priority areas that the Prime Minister has given to us is to expedite the process of National Optical Fibre Network connectivity which we are pursuing very vigorously. I must concede that previous government though of it but it was in limbo," he said.

The BJP led NDA government has decided to connect all 2.5 lakh panchayats in the country which NOFN by 2017 starting with 50,000 gram panchayats this year.

The ministry of urban development is drawing a policy paper on smart cities and may present it in one month's time. The ministry also plans to set up a special purpose vehicle to oversee setting up of smart cities.

According to Shankar Aggarwal, secretary, ministry of urban development, the government would set up a quasi government body to drive smart city projects. This is because, according to Aggarwal, if a purely government body undertakes this task it might take long.

In a previous meeting on smart cities, finance minister Arun Jaitley had proposed urban renewal of 500 cities. The selection of cities would be done through consultation with states and would be based on the economic potential of the area, the official said, while speaking at the i-Bharat 2014 organised by FICCI on Friday.

He said the government is taking learning from the Jawaharlal Nehru national urban renewal mission (JNNURM) project, which failed to achieve the desired results. One of the prime reasons for this is that it failed to make use of technology. Hence, assets were not used optimally.

The Modi government had initially announced to set up 100 smart cities. In this year's budget the government allocated over Rs 7,000 crore for setting up three smart cities.

Rahul Rishi, partner, government advisory services, Ernst & Young, said the need for i-City had arisen because of increasing urban population and depletion of resources. By 2030, 40 percent of India's population would be living in urban areas, 70.6 percent of the population in the urban areas would be covered for water supply for an average of 1-6 hours a day, solid waste generation per capita per day would be 0.6 kg and the average journey speed would slow down to 6-8 km an hour.

Technology would play a key role in making optimal usage of resources and integrated planning, he said. IT would come handy for setting up smart grids and meters. Other areas of IT intervention includes GIS mapping, GIS based rout optimization, smart ticketing, intelligent transportation and surveillance.

Bibek Debroy, professor, centre for policy research, said it was important to improve governance first before integrating IT. Otherwise smart cities, such as other ICT driven projects, would enforce digital divide.

Stating that the Supreme Court ruling to allow CAG to audit accounts of telecom firms may have 'much wider ramifications' and could be applied to other areas subsequently, FICCI said the episode raises serious questions on the sanctity of Indian contracts.

The Supreme Court had on Thursday held that the Comptroller and Auditor General of India (CAG) can audit the account books of private telecom companies that share revenues with the government for using spectrum.

"The episode raises serious questions on the sanctity of Indian contracts. If an external audit is part of the contract it is automatically applicable. Whatever is incorporated ab-initio in the contract, the parties must live with it," FICCI president Sidharth Birla said.

"Subsequent judicial challenge and interpretation creates the possibility of much wider ramifications especially as the government has extensive revenue engagement at all levels of commerce. The application of this pronouncement may get extended to areas that may not have been intended under the subject decision of the Supreme Court," he added.

Stating that the Supreme Court's ruling to allow CAG to audit accounts of telecom firms may have 'much wider ramifications' and could be applied to other areas subsequently, FICCI today said the episode raises serious questions on the sanctity of Indian contracts.

The Supreme Court yesterday held that the Comptroller and Auditor General of India (CAG) can audit the account books of private telecom companies that share revenues with the government for using spectrum.

"The episode raises serious questions on the sanctity of Indian contracts. If an external audit is part of the contract it is automatically applicable. Whatever is incorporated ab-initio in the contract, the parties must live with it," FICCI President Sidharth Birla said.

"Subsequent judicial challenge and interpretation creates the possibility of much wider ramifications especially as the government has extensive revenue engagement at all levels of commerce. The application of this pronouncement may get extended to areas that may not have been intended under the subject decision of the Supreme Court," he added.

The court passed the order on a batch of petitions filed by telecom companies' associations, including AUSPI and Cellular Operators Association of India (COAI), challenging the Delhi High Court verdict which had given green signal for CAG audit of the firms' accounts.

Stating that the Supreme Court's ruling to allow the Comptroller and Auditor General (CAG) to inspect accounts of telecom firms may have 'much wider ramifications' and could be applied to other areas subsequently, FICCI on Friday said the episode raises serious questions on the sanctity of Indian contracts.

The top court on Thursday held that the CAG can audit the account books of private telecom companies that share revenues with the government for using spectrum.

"The episode raises serious questions on the sanctity of Indian contracts. If an external audit is part of the contract it is automatically applicable. Whatever is incorporated ab-initio in the contract, the parties must live with it," FICCI president Sidharth Birla said.

"Subsequent judicial challenge and interpretation creates the possibility of much wider ramifications especially as the government has extensive revenue engagement at all levels of commerce. The application of this pronouncement may get extended to areas that may not have been intended under the subject decision of the Supreme Court," he added.

The court passed the order on a batch of petitions filed by telecom companies' associations, including AUSPI and the Cellular Operators Association of India (COAI), challenging the Delhi High Court verdict which had given green signal for CAG audit of the firms' accounts.

Prime Minister Manmohan Singh today stressed the need to develop a strong manufacturing base for electronics and telecommunication to reduce the dependence on imports, which are likely to cross $300 billion by 2020 — higher than the value of petroleum product imports.

“We need to act now to avoid a situation where we face difficulties in financing these imports. India should have manufacturing facilities, which result in a balanced trade in electronics products and are part of a global supply chain,” Singh said after inaugurating India Telecom 2013, organised by FICCI and the department of telecom (DoT), here today.

He said National Telecom Policy 2012 had brought clarity on many issues. “I understand that the DoT has already started issuing unified licences and will also shortly issue the merger and acquisition guidelines,” he said.

Earlier this week, the empowered group of ministers firmed up their views on merger rules, which will be placed before the cabinet for its approval.

On the use of telecom technologies to modernise systems, Singh touched upon the telecom ministry’s plan to provide 3G connectivity with computers to students.

“Combining a computer with 3G connectivity can revolutionise the delivery of education. Students can learn the subject of their choice from quality teachers without leaving the place of their residence. I am told that the Telecom Commission is working on such possibilities and I wish them all success in this noble endeavour,” he said.

Prime Minister Manmohan Singh on Thursday said rural teledensity is expected to reach over 70% in the next four years thus reducing the socio-economic disparities in the country. Currently, India’s rural teledensity or the number of telephone connections for every hundred people in an area is around 40% with Bharti Airtel holding the maximum number of rural subscribers at 83 million.

Singh also said that a strong domestic manufacturing base in electronics and telecom is needed to mitigate the burden of growing imports for the sector.

“By 2020, India will be importing electronic products worth about $300 billion, which will be more than the value of our imports of petroleum products. We need to act now to avoid a situation where we face difficulties in financing these huge imports,” said Singh at the industry event India Telecom 2013.

Speaking on regulatory issues in the telecom sector, Singh said the National Telecom Policy 2012 has brought clarity on a number of issues in the sector. “I understand that the department of telecommunications has started issuing unified licences and will also shortly issue the merger and acquisition guidelines,” he said.

The empowered group of ministers (EGoM) on telecom on December 3 allowed an entity formed by merger between two or more mobile service providers to hold up to 50% of the market share in a circle, up from 35% allowed earlier. The move is expected to boost consolidation in the sector.

Elaborating on the use of telecom for simplifying education systems, Singh said, “Combining a computer with 3G connectivity can revolutionise the delivery of education... I am told that the Telecom Commission is working on such possibilities and I wish them all success in this noble endeavour.”

The telecom department is in the process of developing a project under which tablet PCs will be given to students with 3G connection. However, the proposal is yet to receive the nod of DoT’s inter-ministerial panel.

Expressing concern for the “millions in rural economy whose lives still remain untouched by the telecom revolution”, the PM said: “One of the key objectives of the NTP 2012 is to raise rural teledensity to 70% by 2017 and 100% by 2020.”

Prime Minister Manmohan Singh on Thursday asked domestic telecom industry to help build manufacturing base in India by 2020. This will be required to restrict India’s future imports and balance of payment (BOP) situation.

“We need to act now to avoid a situation where we face difficulties in financing these huge imports. India should have manufacturing facilities which result in a balanced trade in electronic products and are a part of global supply chains,” Singh in his inaugural address at ‘India Telecom 2013’ event said here.

Net penetration

On the Internet penetration in India, he said that though the urban areas are well connected, connectivity in the rural areas is still a concern.

“On a per capita basis, the usage of the Internet is quite low in India. Both the availability and the reliability of Internet services outside the major cities leave much to be desired,” he said. He said the transformative power of the Internet is clearly visible in the lives of a large number of people in India and services such as travel bookings, banking, shopping and education are increasingly being delivered through the Internet.

Singh emphasised that the Government was committed to provide reliable and affordable telecom and broadband services to rural India and called upon private telecom players to come forward.

USO fund

He said these companies should work with state-owned players with telecom and broadband services, as India’s vast part is yet to be connected with such services to equip it with Internet services.

The Prime Minister also said a scheme to extend financial support from the Universal Service Obligation (USO) Fund for providing mobile communication services in 56,000 uncovered villages of the country is already on the anvil, including in the North Eastern sector.

“We have also approved a scheme for installing mobile towers at about 2,200 locations in the areas affected by Left Wing Extremism at an estimated cost of about Rs 3,000 crore. This too will be financed by the USO Fund,” he added.

The Department of Telecom has given Vodafone Plc the green signal to increase its stake in the Indian mobile unit.

However, the DoT has asked the Finance Ministry to look into the difference in valuation being attributed to the two Indian partners from whom Vodafone is buying the stake.

According to the proposal, Vodafone will increase its holding in the Indian mobile unit from 64.38 per cent to 100 per cent by buying the 24.65 per cent stake held by Analjit Singh-promoted Scorpio Beverages Pvt Ltd and another 10.97 per cent held by Piramal Enterprises. While Piramal will get Rs 8,900 crore, the stake held by Analjit has been valued at Rs 1,241 crore.

The Foreign Investment Promotion Board is scheduled to meet on Friday to discuss the proposal. According to an official source, the differential valuation could be due to three reasons including outstanding debt in the Analjit Singh-promoted company.

“Holding company discounts are applicable to Analjit Singh’s indirect shareholding resulting in lowering the value,” stated an internal document seen by Business Line.

The DoT has also flagged a pending litigation filed by an NGO against the company alleging benami shareholding in Vodafone India by individuals including Analjit Singh. The DoT said that the approval to Vodafone’s proposal for increasing holding to 100 per cent should be subject to the court’s judgment on this case. Vodafone Plc plans to hold the entire stake in its Indian arm through a dozen different companies, which are existing shareholders, after it buys out the minority stake held by Indian partners. The company intends to invest Rs 10,141 crore to purchase the stake it does not currently own.

Following the buyout, the total direct foreign shareholding in VIL would be 75.35 per cent and indirect holding at 24.65 per cent. There wouldn’t be any Indian shareholding in the company post the completion of the proposed buyout, according to FIPB documents filed by Vodafone.

Euro Pacific Securities, Mobilvest, and Trans Crystal are among the eight companies that would be the direct foreign shareholders, while Telecom Investments India, Usha Martin Telematics and Omega Telecom Holdings are among the indirect shareholders, it said in the proposal, a copy of which was seen by Business Line.

The 64.38 per cent stake is currently held by Vodafone International Holdings B.V. (VIHBV), a company incorporated in The Netherlands and a subsidiary of Vodafone Group Plc, through its wholly-owned subsidiaries.

CGP India Investments Ltd, an indirect shareholder in VIL and an indirect Mauritian subsidiary of Vodafone International Holdings B.V. (VIHBV) proposes to buy stake from Scorpio Beverages Pvt Ltd. CGP intends to acquire the 51 per cent stake held by Analjit Singh and Neelu Analjit Singh in SBP.

Prime Metals Ltd, a shareholder of VIL and a wholly-owned Mauritian subsidiary of CGP, would acquire VIL’s 10.97 per cent stake from Piramal Enterprises.

Prime Minister Manmohan Singh on Thursday asked the domestic telecom industry to gear up to build a strong manufacturing base in India by 2020 to arrest the import bill for such equipment.

“I would like to take today’s opportunity to repeat a point that I made last year. India needs to develop a strong domestic manufacturing base in electronics and telecommunication. It is estimated that by 2020 India will be importing electronics product worth $300 billion, which will be more than the value of our oil imports,” he said.

“We need to act now to avoid a situation where we face difficulties in financing these imports. India should have manufacturing facilities, which result in a balanced trade in electronics products and are part of global supply change,” the PM said after inaugurating India Telecom 2013 organised by industry chamber FICCI and the department of telecommunication (DoT).

The Prime Minister, Dr Manmohan Singh, has asked the domestic telecom industry to gear up to build a huge manufacturing base in India by 2020.

He said investments worth $300 billion would be needed to supply electronic equipment and relevant inputs to telecom manufacturers and restrict and contain its future imports and balance of payment (BoP) situation.

“We need to act now to avoid a situation where we face difficulties in financing these huge imports.

“India should have manufacturing facilities which result in a balanced trade in electronics products and are a part of global supply chains,” Dr Singh said while inaugurating India Telecom 2013 organised by the department of telecommunications (DoT) and FICCI here today.

The PM said DoT is working on an eco-system for electronics manufacturing activities to ensure its inclusive development and the Telecom Commission (TC) is engaged with expansion of telecom services in rural areas to achieve 70 per cent and 100 per cent tele-density by 2017 and 2020, respectively.

Dr Singh said efforts are on to install 2200 mobile towers with estimated investments of Rs 5,300 crore, funds for which would be generated out of the USO fund.

Mr Singh emphasised that the government is committed to provide reliable and affordable telecom and broadband services to rural India.

The Prime Minister called upon private telecom players to come forward to network with state-owned players for telecom and broadband services as large parts of India are yet to be connected with such services.

Electronics imports may constitute volumes next to petro imports in future and be a drain on the country's BoP situation, indicated Dr Singh, adding that the emerging trend needs to be arrested with the help of the government but the private sector ought to come forward.

The telecom minister, Mr Kapil Sibal, hoped that DoT would be able to generate the targeted amount of Rs 40,000 crore through sale of spectrum for which policy decisions and measures, including guidelines, are already in the public domain.

Telecom Minister Kapil Sibal today launched three smartphones and one feature phone manufactured by domestic companies.

Handset firms Karbonn and Lava International launched their smartphones, while Maxx Mobiles introduced its feature phone targetted at the rural market.

The phones were launched at India Telecom 2013, organised by the Department of Telecom and industry body FICCI.

Karbonn expanded its smartphone range with Titanium X, priced at Rs 18,490, which has a full high definition display and 13 megapixel rear camera.

Lava International introduced two smartphones for Rs 5,499 and Rs 9,999, which are designed by its in-house research and development team.

Maxx Mobiles feature phone is priced at Rs 1,932, which has a dual SIM slot, camera, 16 GB expandable memory, GPRS and a LED torch, targetted at the rural customers.

Prime Minister Manmohan Singh, on Thursday, said a strong domestic manufacturing base in electronics and telecommunications is needed to mitigate burden of growing imports for the sector.

“India needs to develop a strong domestic manufacturing base in electronics and telecommunications,” Singh said in his inaugural address at India Telecom 2013, which was organised by Department of Telecommunications and industry body FICCI.

By 2020, the Prime Minister said, India is estimated to import electronics products worth about $300 billion, more than the value of the country’s imports of petroleum products.

“We need to act now to avoid a situation where we face difficulties in financing these huge imports. India should have manufacturing facilities which result in a balanced trade in electronics products and are a part of global supply chains,” Singh said.

The Prime Minister also said that the Department of Telecommunications has already started issuing Unified Licenses and will also shortly issue the Merger and Acquisition guidelines. The Empowered Group of Ministers, headed by Finance Minister P Chidambaram, had finalised the M&A policy for the telecom sector earlier this week, which will be finally cleared by the Union Cabinet.

“Combining a computer with 3G connectivity can revolutionise the delivery of education. Students can learn the subject of their choice from quality teachers without leaving the place of their residence. I am told that the Telecom Commission is working on such possibilities and I wish them all success in this noble endeavour,” said the Prime Minister.

Singh also said that the Government is working on the objective of increasing teledonsity in the rural areas to about 70% by 2017 and 100% by 2020, as part of the National Telecom Policy 2012. “The policy also recognises telecom and broadband connectivity as a basic necessity and aims to provide reliable and affordable broadband access to rural areas,” he added. The Government is already working on a plan to extend financial support for the Universal Service Obligation Fund (USFO) for providing mobile communication services in 56,000 uncovered villages across India.

The government is set to kickstart the spectrum auction process as the notice inviting applicants (NIA) for the sale will be issued over the next 15-20 days, telecom secretary MF Farooqui said.

Speaking on the sidelines of India Telecom summit organized by industry chamber FICCI, Farooqui said he expected the 2G auctions to happen in January. "In about 15-20 days time from now, we will be issuing the NIA," Farooqui said, adding that 403 MHz spectrum will be put up for sale in the 1800 MHz band and 45 Mhz in the 900 MHz band.

Asked whether he expected any movement in the sale of 3G airwaves, he said there were no immediate plans. "While we are working on it, there are not many chances for 3G auctions to occur in January." The government expects to earn up to Rs 40,000 crore from the 2G spectrum auctions.

Asked about the auction in the 800 MHz band, used by CDMA service operators, Farooqui said DoT will write to sector regulator Trai, asking for fresh recommendations on the matter. "The department of telecom will write to Trai this week and the process will then be taken forward," he said, refusing to give any timeline for the CDMA auction.

"The timeline, I cannot predict ... Once we have the reply from Trai, we have to examine it, after which it will to go to the telecom commission and the empowered group of ministers (EGoM) and so on ... I don't want to make a commitment about the timeline." he added.

Trai had not recommended a reserve price for the 800 MHz band and asked DoT to explore the feasibility of an extended-GSM band for this frequency.

The Government on Thursday announced that nationwide mobile number portability (MNP) is expected to be rolled out by February.

This means that users can retain their numbers even if they move from one State (and telecom circle) to another.

Right now, consumers are allowed to switch to a different operator within their circle with the same number.“For the timely implementation of the National Telecom Policy (NTP) 2012, the Department of Telecom has finalised the broad agenda for the next three months from December 2012 to February 2013,” Kapil Sibal, Minister of Communications and Information Technology (IT) said at India Telecom 2012, being organised by FICCI in association with the Ministry of Communications and IT.

Some of the key initiatives to be completed by February, mentioned by Sibal, are approval of spectrum assignment and pricing, unified licensing regime, M&A guidelines, finalisation of guidelines for spectrum sharing, creation of fund for R&D and manufacturing and MNP on a nationwide basis.

Under NTP 2012, the Government had envisaged implementing MNP on a nationwide level allowing users to retain their mobile numbers even when they shift to a different telecom circle. India has 22 telecom circles.

According to the Telecom Regulatory Authority of India (TRAI), by October-end, about 75.14 million subscribers had submitted their requests to the various service providers for moving to other services.

What needs to be done

Meanwhile, Prime Minister Manmohan Singh flagged off three major challenges for the industry and the Government to take the telecom revolution to the next level.

The challenges include deepening the penetration of basic telecom services, providing affordable and accessible broadband services, and strengthening the domestic manufacturing capabilities across the entire value chain in telecom and electronics.

Addressing the seventh edition of India Telecom with the theme ‘New Policy Framework: Envisioning the Next Telecom Revolution’, Singh said during the last one year, the Government has taken a number of forward-looking initiatives in the telecom sector.

“We have attempted to clarify the policy positions on a number of complex issues. We have attempted to ensure adequate availability of spectrum and its allocation in a transparent manner through market-related processes,” he said.

“I am confident that the futuristic policy regime that we are now putting in place will address, and address effectively, the concerns that have been worrying investors and will provide a new impetus to the growth of telecommunication industry in our country,” Singh said.

Hardware manufacture

On domestic manufacturing, he said the country needs ‘leaders in telecom and electronics manufacturing’ who can break new ground and create the ecosystems to enable India to become a major producer of hardware.

The new Telecom and Electronics Policies have been already laid down the regime for enabling this to happen and now it was for the captains of the industry, particularly in the ‘private sector that they have to seize this unique initiative’ he said.

“As a major automobile-buying country, we have developed a strong automotive sector. I believe this can be and must be replicated in telecom and electronics as well,” Singh said.

And, as the National Optical Fibre Network project to provide broadband connectivity to all panchayats has been launched, he said it is time to spread broadband services in rural areas, especially with initiatives to provide smartphones and tablet computers at ‘reasonable prices’.

Amid repeated complaints of policy paralysis, communications and HRD minister Kapil Sibal on Thursday sought to dispel the notion of inaction and suggested that it was for the private sector to act after a series of measures by the government.

"We have taken decisions after decisions. If there is paralysis, it is the rollout of those decisions and it depends on the private sector. Private sector must see the opportunity and ensure there is rollout," he said at an event while suggesting that telecom operators need to go above self-interest and look at the larger opportunities awaiting the sector.

Sibal's reference was mainly to slow rollout of 3G services, which have not gained large subscriber base, although operators say that the numbers are slowly growing. Sources in Sanchar Bhawan said the minister is of the view that the communications ministry has done its bit by rolling out the broadband policy, the new telecom policy and even putting the 2G spectrum auction back on track with even an extended deadline from the Supreme Court.

The telecom industry, while acknowledging that the government had initiated steps, believes that market dynamics and the poor economic environment have impacted the sector. "The industry has been starved for investment after paying such a large amount (for spectrum) to the government. If there been a delay in roll out, it's been due to scarcity of capital, high spectrum prices paid and high burden of levies and now the threat of having to pay high spectrum charges for 2G and the general uncertainty on the economy," said Rajan Mathews, director general of lobby group Cellular Operators Association of India.

The regulatory environment and the high debt levels of several companies have impacted the share prices as fund raising has been hit by adverse market conditions. At the event, the minister also suggested that most private players were not pushing the industry's cause but were looking at their own interests.

"Each telecom operator when he comes to me, his focus is his business, his future.... If your self-interest is your driving force then Newton's law of motion will apply. Every action will have an equal and opposite reaction. What will happen is your self-interest will be ultimately hurt," Sibal said.

He said the government has framed a clear-cut policy for the telecom, IT and communication sectors for the next 10-15 years. He asked private operators to seize those opportunities and work in larger public interest.

Communications and Information Technology Minister Kapil Sibal said that India is at the threshold of a data Revolution. While delivering the keynote address at the curtain raiser ceremony of India Telecom 2012, the Minister said knowledge is empowering and ensures good governance and inclusive and sustainable growth. He said today mobile phone has become more than a communication device, and services are becoming increasingly linked through mobile, Internet and other digital modes of delivery. The Seventh Edition of India Telecom- 2012 will be held from December 13-15 in New Delhi on the subject “New Policy, Framework: Envisioning the next Telecom Revolution”.

The Supreme Court on Wednesday said it will hear all the issues framed by it on the Presidential Reference on the 2G spectrum verdict and its decision on objections on maintainability and the merits of the case will be pronounced together.

After hearing five days of extensive arguments on the maintanibility of the reference, a five-judge constitution bench headed by Chief Justice S H Kapadia said instead of passing its order on the maintainability at this stage, it would hear every aspect, including the merits of the reference before arriving at its opinion.

The bench asked Attorney General G E Vahanvati to commence Government's arguments from tomorrow on the merits of the reference. "We will hear the matter on the entire issue. We will decide the reference on merits and also on the initial objection on its maintainability at the end," said the bench, also comprising justices D K Jain, J S Khehar, Dipak Mishra and Ranjan Gogai.

The reference covers various issues arising out of the apex court's 2G spectrum case verdict including whether auctioning of natural resources across all the sectors is mandatory and whether the verdict in the 2G case can be given retrospective effect for radio waves granted since 1994.

The court had on May 11 issued notices and sought responses also from state governments and FICCI and CII on behalf of the private industries along with those of the NGO, Centre for Public Interest Litigation (CPIL) and Janata Party President Subramanian Swamy.

Industry chamber FICCI on Wednesday urged the Supreme Court to give its opinion on the Presidential reference that sought clarification on the 2G spectrum order, saying the February 2 judgment went beyond the telecom dispute and interfered in the “formulation, adjudication and implementation” of the government policy.

The Supreme Court said on Wednesday that it will first hear all the issues arising out of the Presidential Reference on the 2G spectrum ruling and then decide on its maintainability and merit.

The five-judge Constitution Bench, headed by the Chief Justice Mr S H Kapadia, said this after hearing arguments on the maintainability of the reference for five days. The court has directed the Attorney General, Mr G E Vahanvati, to start the Government’s arguments on the merits of the reference from Thursday.

The issues that will be heard include whether it is mandatory for the Government to distribute all natural resources only through a public auction (as directed in the earlier 2G ruling) or whether the Government can choose any other option such as the first-come-first-served (FCFS) for their allocation.

On May 11, the court had issued notices to the NGO, Centre for Public Interest Litigation (CPIL) and the Janata Party President, Dr Subramanian Swamy, (both petitioners in the 2G case), State Governments and industry bodies such as CII and FICCI.

On February 2, the apex court has passed its order on the petition filed by CPIL and Dr Swamy, cancelling 122 licences granted during the regime of the then Telecom Minister, Mr A Raja, after finding illegalities in their distribution. It also held that the FCFS policy was flawed.

The CII, represented by senior advocate, Mr Harish Salve, argued in favour of the reference, claiming it was maintainable. It said observations in the 2G ruling -- that it was mandatory for the Government to auction all natural resources – go beyond the scope of writ of mandamus.

FICCI, represented by senior advocate, Mr C A Sundram, said the 2G ruling amounted to judiciary getting into the executive’s domain of policy-making, adding that the verdict would also impact foreign investment in the telecom and other sectors.

The Supreme Court on Wednesday decided to hear arguments on the merits of the questions posed to it through the Presidential reference sent following the 2G verdict.

A five-judge Constitution bench headed by Chief Justice S H Kapadia said that it would hear the matter including the merits of the reference before making any conclusion on it. The bench heard for five days elaborate arguments advanced by various parties including the Attorney General and industry bodies like CII and FICCI on the maintainability of the Presidential reference. The court directed Attorney General G E Vahanvati to advance his arguments from Thursday on merits of the reference.

Janata Party president Subramanian Swamy and NGO petitioner Centre for Public Interest Litigation (CPIL) had contended that since the reference had questioned the correctness of the verdict delivered by a division bench on February 2, the apex court could not exercise its advisory jurisdiction to give its opinion on it.

The apex court had in a significant order cancelled 122 licences of 2G spectrum granted to 11 companies in 2008, noting the “flaw” in the government’s first-com-first-serve policy for use of natural resources. In April, a Presidential reference was sent to the apex court seeking its opinion on a range of issues including if auctioning of natural resources across all sectors was mandatory.

The government will not challenge the Supreme Court decision to cancel 122 telecoms licences, Telecom Secretary R Chandrashekhar Wednesday. “We are not looking at challenging the cancellation of the licences per se,” he told reporters on the sidelines of a FICCI event here.

He further added: “...By the end of this week, we expect to be able to take the key decisions... all the legal options that are on the table at this point.” The government is said to be toying with the idea of making a Presidential Reference on the issue if it decides not to file a review petition.

The government has indicated that it will not be able to meet the deadline set by the Supreme Court for fresh auctions of 2G airwaves while cancelling 122 mobile permits awarded by former telecom minister A Raja in 2008.

Telecom secretary R Chandrasekhar on Wednesday said the fresh auctions will take at least 400 days, while pricing of the airwaves will be finalised within the next couple of months.

While cancelling mobile permits of eight of the 14 telecom firms operating in the country, the Supreme Court had on February 2 ordered the government to hold fresh auctions within four months to redistribute the permits and airwaves.

"The 400-day timeline has taken into account all the decision-making involved, including establishing committees for all the decisions," Chandrasekhar said on the sidelines of an event organised by industry lobby FICCI. He added that completion of auction, payment and assignment of frequencies, and allocation of spectrum to successful parties have all been taken into account to arrive at this timeline.

The government is counting 400 days from the date of the judgement. Chandrasekhar did not, however, divulge whether the Department of Telecom would approach the Supreme Court to seek an extension of the four-month deadline.

The pricing of the 2G spectrum will be decided within the next few months and before the auctions so that operators are able to bid will complete clarity, the secretary said. The government will take a decision on pricing on the basis of the availability of spectrum, the manner of pricing and the policy of charging. This will allow operators, manufacturers and others involved to work out their plans for bidding.

The final approval for the National Telecom Policy, expected by April-May, will offer more clarity, the secretary added.

On being asked about the Russian conglomerate Sistema's move to invoke an Indo-Russian bilateral investment treaty to protect its investment in India, Chandrasekhar said that the telecom department would seek legal opinion from the law ministry.

"Every party involved, including the government, has the right to look at the legal options available to them. These are questions that are being looked at. To the extent that they relate to telecom matters, DoT would have to take its own advice and come to its own conclusions on an appropriate course of action. DoT will seek a legal opinion from the law ministry," he said.

Sistema had on Tuesday threatened India with international arbitration proceedings if the government failed to amicably resolve within six months the fallout of the Supreme Court's verdict, which cancelled 21 of Sistema Shyam's 22 licences in India. Sistema owns 56.68% of Sistema Shyam Teleservices, a joint venture with India's Shyam Group that offers mobile and data services under the MTS brand to 15 million customers.

The government on Wednesday said it would only seek a limited review of the Supreme Court's order on the 2G scam even as Videocon joined the queue of operators filing petitions.

"We are not looking at challenging the cancellation of the licences per se... By the end of this week, we expect to be able to take the key decisions on what legal steps the government would take on the Supreme Court decision," telecom secretary R Chandrashekhar said on the sidelines of an event organized by FICCI.

Videocon, however, indicated that it will file a review petition. "CBI has given us a clean chit. The apex court has given us a clean chit. We were just the innocent bystander and our licences got cancelled. We will ask for justice," Venugopal Dhoot told TOI while ruling out exiting the telecom business. "Why should we exit? We have got strong subscriber base with robust dealer and distributor network pan India," he said.

The affected telecom companies - ranging from Videcon to Unitech Wireless and Shyam Sistema and Tata Tele -- have two days for filing review petitions. Idea has also sought clarifications from the court on the order that resulted in the cancellation of 122 licences awarded during A Raja's term as telecom minister. The court had asked the government to proceed with a fresh auction for licences and spectrum and had said that the process should be completed in four months.

On Wednesday, Chandrashekhar, however, indicated that the entire exercise may take longer. "Four hundred days is the estimate for everything, including completion of auction, payment and assignment of frequencies and allocation of spectrum to parties," the telecom secretary said in the first public indication that the process will be longer than originally expected. The longer-than-expected process may prompt the government to seek an extended deadline from the court.

In addition, it is expected to seek guidance from the Supreme Court on how the allocation of scarce resources should be handled. The court had ruled that the government should abandon the first-come-first-served principle, something that the Centre is not too comfortable doing.

As reported by TOI on Tuesday, the government is expected to seek the apex court's opinion through a presidential reference. The telecom department is currently looking at "all options available". "At this point of time, no final decision has been taken with regards to the legal steps that will be taken. We are consulting all the legal advisors within the government and a formal decision is expected shortly," the telecom secretary added.

The Government will not challenge The Supreme Court decision to cancel 122 telecoms licences, Telecom Secretary R Chandrashekhar on Wednesday.

"We are not looking at challenging the cancellation of the licences per se," Chandrashekhar told reporters on the sidelines of a FICCI event. The Government has one month from the date of the apex court's February 2 judgement to file a review petition and Chandrashekhar said a decision will be taken before that.

"... By the end of this week, we expect to be able to take the key decisions... All legal options are on the table at this point," he said.

Telecom Minister Kapil Sibal had previously stated that the judgement had ramifications on several other sectors of the economy where natural resources like mines are allocated on the Supreme Court-condemned first-come-first-serve basis.

"There are a number of issues that arise from the Supreme Court order and these require careful analysis which is what we are doing... Not only analysis of the issue but what are the legal options in terms of actions that can be taken," Chandrashekhar said.

Idea Cellular and Tata Teleservices have already moved the apex court seeking review of the judgement. In its order cancelling the 122 telecom licences, the Supreme Court had asked the Government to conduct an auction for spectrum within four months. The Government is contemplating a timeline of 400 days for the completion of auction process. "The 400 day timeline has taken into account all the decision making involved including estabilishing committees, payment and assignment of frequencies and allocation of spectrum," he said. The secretary, however, refused to divulge if they will seek an extension from the apex court.

"We need to understand whether the SC has set up a particular timeline for the auction. There are different views on this aspect," he said. On being asked if the dual technology licences issued after 2008 would also be impacted by the SC judgement, he said there are a number of issues that arise from the SC order which require careful analysis "which is what we are doing".

Asked about Sistema's notice to the Government, Chandrashekhar said, "The party involved has a right to look at whatever are the legal options available to them ... obviously the DoT would have to also take its own advice and come to its own conclusion."

Invoking bilateral investment treaty yesterday, Russian conglomerate Sistema has asked the government to resolve within six months the dispute related to the cancellation of 21 telecom licences of its local joint venture.

PM Manmohan Singh on Wednesday reassured the telecom industry of the government's "full commitment to sustain growth, creativity and enterprise in this vitally important sector of our economy".

Speaking at the inaugural ceremony of India Telecom 2011, jointly hosted by the DoT and FICCI in Delhi, Singh said he was "aware of some concerns of the telecom industry regarding government policies in the telecom sector".

However, firmly expressing his conviction that in telecom minister Kapil Sibal, "government and the industry has a leader who is going to make the future happen," the PM urged "industry to look ahead and work towards giving a new momentum and energy to the development and spread of telecommunications in the country".

Prime Minister Manmohan Singh on Wednesday said the government would look into the concerns of the telecom operators pertaining to lowering levies and early resolution of a dispute over 3G roaming and formulate forward-looking policies to sustain growth in the sector.

“I am aware of some concerns of the telecom industry regarding government policy in the telecom sector. I wish to reassure the industry of government's full commitment to sustainable growth, creativity and enterprise in this vitally important sector of our economy,” he said while inaugurating the India Telecom Summit jointly organised by the Telecom Ministry and the Federation of Indian Chambers of Commerce and Industry (FICCI) here. Noting that the two National Telecom Policies of 1994 and 1999 were major initiatives to propel growth in the sector, Dr. Singh said the government was working on the NTP-2011 with a special emphasis on affordable and quality telecom services in rural and remote areas. “The government is committed to achieving success in this vital sector of the economy. We will work closely with all stakeholders,” he said.

Amid telecom operators seeking lower levies and early resolution of a dispute over 3G roaming, Prime Minister Manmohan Singh today said the government will look into their concerns and formulate forward-looking policies to sustain growth in the sector.

“I am aware of some concerns of the telecom industry regarding government policy in the telecom sector. I wish to reassure the industry of the government’s full commitment to sustainable growth, creativity and enterprise in this vitally important sector of our economy,” he said, inaugurating the India Telecom Summit here organised jointly by the Telecom Ministry and FICCI here.

Prime Minister’s statement came in the wake of a recent meeting of the CEOs of top telecom firms, including Bharti Airtel, Vodafone and Reliance Communications, seeking his intervention to sort out differences between them and the Telecom Ministry over issues ranging from one-time spectrum charges to 3G roaming pact and a uniform licence fee.

Those from the industry at the meeting were Bharti Airtel chairman Sunil Bharti Mittal, Reliance Group chairman Anil Ambani, Aditya Vikram Birla Group chairman Kumar Mangalam Birla, Vodafone Group chief executive Vittoria Collao and Tata Sons director Ishaat Hussain.

The telecom operators have been particularly peeved with the Department of Telecom (DoT) over the latter’s view towards the 3G roaming pact between the telecom operators. The DoT is of the view that the roaming pacts which give the subscribers of these particular telecom operators a seamless roaming on third generation 3G are in contravention of the licence and hence has been seeking to impose a penalty on them.

“I would like to take this opportunity to assure all of you that our government will continue to formulate forward-looking policies that will encourage further growth of the telecom sector,” Manmohan Singh said.

According to the Prime Minister, India was today the fastest growing telecom market in the world, adding 18 million new connections to the network every month. In the process, wireless tele-density had grown from 2 per cent in 2000 to 72.1 per cent now.

Noting that the two National Telecom Policies of 1994 and 1999 were major initiatives to propel growth in the sector, the Prime Minister said the government was working on the NTP-2011 with a special emphasis on affordable and quality telecom services in rural and remote areas of the country.

He said the new draft telecom policy aimed at 175 million broadband connections by 2017 and 600 million by 2020 at a minimum download speed of 2 megabits per second, from 12.8 million at present. All village blocks will also have broadband access by 2014.

Telecom Commission , the apex decision-making body of the communications ministry, will clear the national broadband policy within a next few weeks after which it will be sent to the Cabinet for approval, a top official in the department said on Wednesday.

The national broadband policy is aimed at setting up networks estimated to cost 60,000 crore to facilitate high-speed data and e-governance.

"The Telecom Department will send the national broadband policy to the Cabinet in the next few weeks before which it will be cleared by the Telecom Commission," telecoms secretary R Chandrasekhar said at a FICCI event on Wednesday.

Earlier in the day, the telecoms minister Kapil Sibal met various operators to discuss the national broadband policy. Sibal had earlier said that the policy would be finalised by the end of this fiscal.

The broadband policy would balance consumer affordability and service provider's economic sustainability. Last year, telecom authority Trai had recommended setting up a national broadband network in order to achieve 160 million broadband connections by 2014. Trai said the 'National Broadband Plan' should be financed through a universal service obligation (USO) fund and loans given by the government. All telcos contribute 5% of their revenues towards this fund that is used to promote rural telephony. The unutilised amount in the USOF is estimated to be about 25,000 crore. Trai's recommendations came amid the government's failure to meet its target of 20 million broadband connections by 2010. At present, the number of broadband connections is only 10.3 million.

The government aims at inclusive growth through broadband as education, medical treatment and entertainment related applications would be extensively used, besides enabling e-governance and citizen-centric services particularly in the rural areas.

As per the plan, optical fibre network will be treated as a national resource and will be equally available to concerned stakeholders for providing broadband services. To establish this broadband network, a national optical fibre agency (NOFA), proposed to be a 100% central government-owned holding company, will be set up. NOFA will also establish networks in all 63 cities covered under Jawaharlal Nehru Urban Rural Mission . The state agencies will set up networks and backhaul in rural and rest of urban India.

A state optical fiber agency (SOFA) would be formed in every state where NOFA would be the holding company with 51% equity and 49% by the respective state government.

The Department of Telecom will soon unveil the New Telecom Policy 2011 and a national broadband plan over the next weeks. Mr R. Chandrashekhar, Secretary, Department of Telecommunications, said that the policy will be forwarded to the Telecom Commission for a review and thereafter to the Cabinet for a final decision.

Addressing an interactive meeting on National Telecom Policy (NTP) 2011 organised by FICCI, Mr Chandrashekhar said that the national broadband plan will lay a strong foundation for broadband infrastructure both for wireless and fixed line. This would require funds on a massive scale as the plan would be rolled out on considerations that would not purely be commercial, he said. The Government is planning to lay an optic fibre cable network across the country at a cost of Rs 30,000 crore.

A FICCI-Ernst & Young report on the telecom sector was also released and it has recommended a seven-point package of measures to overcome the various challenges faced by the sector. The key recommendations made in the report include a single unified licence covering all telecom services, allowing spectrum sharing and trading and lowering the operator's contribution from 5 per cent to 1 per cent of the annual revenues towards the USO fund.

Meanwhile, the Communications and IT Minister, Mr Kapil Sibal, met telecom operators on Wednesday to discuss the proposed broadband policy. Most mobile operators are opposing the idea of spending money from the USO fund to lay an optical fibre cable to the last mile.

The National Telecom Policy 2011 would be put before the full Telecom Commission in few weeks and thereafter sent to the Cabinet, department of telecommunications (DoT) secretary R chandrasekhar said at a FICCI conference. He also said the DoT would soon send the the national broadband plan to the Cabinet for an approval once the Telecom Commission clears it. The policy aims at linking 12 lakh villages through optic fibre network at an estimated cost of R60,000 crore to facilitate high-speed data and e-governance. At the same conference, Trai said it will bring out a consultation paper on mobile value-added services next month and will give its recommendations by end of June.

The Department of telecommunications ( DoT) is likely to forward the National Broadband Pian ( NBP) for Cabinet approval in the next couple of weeks to pave the way for expanding the county’s broadband network.

“We will send the NBP to the Cabinet in the next few weeks before which it will be cleared by the Telecom Commission,” telecom secretary R. Chandrasekhar said on the sidelines of a function at the Federation of Indian Chambers of Commerce and Industry (FICCI) on Wednesday.

The NBP will lay the framework for expanding the broadband network to promote e- governance and transmission of highspeed data.

In December last year, the Telecom Regulatory Authority of India (Trai) had come out with recommendations to set up a national broadband network at an estimated investment of about Rs. 60,000 crore.

The suggestions from Trai on the National Broadband Plan came in the wake of the government’s failure to meet its target of two crore broadband connections by 2010.

Communications and IT Minister Kapil Sibal on Thursday cautioned against putting unnecessary pressure on the telecom sector for generating revenues which could lead to hike in tariffs. He also urged the telecom operators not to indulge in any kind of war of words as it could jeopardise the growth of the sector.

“The telecom sector should not be viewed as a source of revenue, especially in the context of the (2G spectrum auction) debate taking place today. Everybody is looking at the telecom sector as a source for earning money for the Finance Ministry,” Mr. Sibal told journalists here after inaugurating the ‘India Telecom 2010' international exhibition and conference, organised by the Department of Telecommunications (DoT) in association with the Federation of Indian Chambers of Commerce and Industry (FICCI).

“We must also ensure that the telecom industry had enough money to invest in the sector. If price of spectrum is high then you will reach a situation where you will not be able to provide low tariffs. Broadband and telecom should be looked upon as a vehicle of empowerment rather than a sector from which we can squeeze money to achieve our fiscal growth,” he said.

Referring to the war of words between telecom operators, Mr. Sibal said: “What I find today is unfortunate, some operators are at war with others. This is because at any given point of time they felt that they had been discriminated against…however, we will ensure a level-playing-field for all the telecom service providers in future.”

Earlier delivering his inaugural speech, Mr. Sibal called upon all stakeholders to work towards strengthening the hardware and manufacturing segment of the telecom sector. “Telecom as the service industry alone cannot continue to contribute to country's GDP at the level it is doing now for long,” he pointed out.

The Minister also underlined the importance of a strong hardware and manufacturing component of the telecom industry for sustainability of the sector's contribution to the economy. “Guidelines and policies need to be prepared in consultation with all stakeholders to ensure that the telecom sector becomes more and more investor-friendly, its penetration and reach increases to provide greater access and tariff remains low so as to offer the services at affordable cost,” he added.

On the occasion, the Minister also released the FICCI-KPMG report — Broadband for All — which reveals that telecom companies, whose operating margins are under pressure due to usage of multiple SIMs, multiple tariff corrections and rising competition, are keenly awaiting the roll-out of 3G and BWA to bolster the maturing urban markets and enhance margins.

The FICCI-KPMG report points out that the broadband sector is expected to log tremendous growth in the future as over 65-crore potential customers are waiting to be tapped. Rural India, the report states, is the key target market likely to drive the next round of growth for telecom companies, particularly for voice based services.

At his first public meeting at FICCI's India Telecom 2010 on Thursday, telecom minister Kapil Sibal will be addressing a large number of cellular stakeholders, including operators, equipment providers, international investors, analysts and the media.

Sibal is standing in for Prime Minister Manmohan Singh, who usually inaugurates India Telecom—a key telecom conference —jointly hosted by DoT and FICCI.

Barring a few private meetings and TV interviews, this will be the sector's first tryst with Sibal's vision on how he plans to tackle the 2G telecom scam and whether he can drive confidence among investors and telecom stakeholders. Undoubtedly, India's telecom sector—once the crown jewel of investments, privatisation and successful PPPs—faces its biggest crisis of confidence ever.

According to telecom analysts, Sibal has so far done some right things including issuing show-cause notices to companies identified by the CAG for ineligible applications for 2G spectrum, or formed a part of Trai's list of companies that had defaulted in meeting roll-out obligations. He has also taken steps to clean up the DoT.

However, his critics argue that his actions display a lack of choice rather than vision. Slapping show-cause notices on errant companies is the next logical step for DoT, which should have acted by itself in the first place, rather than waiting for CAG or Trai. Even officials, who have been removed, had become unpalatable and it was clear that CBI was ready to raid them which it finally did on Wednesday.

"Sibal is accompanied by foreign delegates which may restrict his comments at India Telecom. However, as a savvy lawyer and popular politician, he could seize this opportunity to show that he means business without clinging on to Raja's defence or blaming others for loss to exchequer revenue," points out a DoT official.

The rollout of third generation (3G) and broadband wireless access (BWA) will take place soon, according to Mr A. Raja, Minister for Communications and Information Technology.

Addressing the curtain raiser ceremony for India Telecom 2010 organised by the FICCI, Mr Raja said the rollout will result in a fillip for the wireless broadband segment in India.

He added that synergy of government policies and entrepreneurial zeal has seen the Indian telecom industry get a total subscriber base of over 670 million as well as an overall tele-density of 58 per cent by July which has made India the second largest network in the world.

Mr Raja added that 10,000 shareable mobile towers are proposed to be set up in rural India this year with the support of the Universal Service Obligation Fund. He said that due to the competition arising out of the introduction of new telecom service providers, the tariff plan as low as 1 paise a second is available to Indian citizens for making calls within the country.

Meanwhile, Mr Sachin Pilot, Union Minister of State for Communications & IT, while expressing concern over the rural-urban tele-density gap of 1:5, emphasised the need to focus on what the country needed to achieve in terms of unrealised targets. He underlined the need to create applications and a platform for delivery of services to the customers.

“Services such as e-healthcare, e-education, and e-governance on the broadband platform can be an effective tool for government interventions to ensure rural empowerment and raising the quality of rural life,” said Mr Pilot, adding that broadband can help in not only improving agricultural and commercial productivity in rural areas but also in overcome the constraints of inadequate transport infrastructure.

The rollout of third generation (3G) and broadband wireless access (BWA) will take place soon, according to Mr A. Raja, Minister for Communications and Information Technology.

Addressing the curtain raiser ceremony for India Telecom 2010 organised by the FICCI, Mr Raja said the rollout will result in a fillip for the wireless broadband segment in India.

He added that synergy of government policies and entrepreneurial zeal has seen the Indian telecom industry get a total subscriber base of over 670 million as well as an overall tele-density of 58 per cent by July which has made India the second largest network in the world.

Mr Raja added that 10,000 shareable mobile towers are proposed to be set up in rural India this year with the support of the Universal Service Obligation Fund. He said that due to the competition arising out of the introduction of new telecom service providers, the tariff plan as low as 1 paise a second is available to Indian citizens for making calls within the country.

Meanwhile, Mr Sachin Pilot, Union Minister of State for Communications & IT, while expressing concern over the rural-urban tele-density gap of 1:5, emphasised the need to focus on what the country needed to achieve in terms of unrealised targets. He underlined the need to create applications and a platform for delivery of services to the customers.

“Services such as e-healthcare, e-education, and e-governance on the broadband platform can be an effective tool for government interventions to ensure rural empowerment and raising the quality of rural life,” said Mr Pilot, adding that broadband can help in not only improving agricultural and commercial productivity in rural areas but also in overcome the constraints of inadequate transport infrastructure.

The Centre is all set to roll out national optical fibre policy to connect all the village panchayats in the country.

This was stated by A Raja, Union Minister for Communications and Information Technology at the curtain raiser ceremony of India Telecom 2010, the fifth international exhibition & conference under the theme ‘Broadband for All’ being organised jointly by the Department of Telecommunications, Ministry of Communications & IT and FICCI from December 9-11, 2010 in the Capital.

“There is a huge accumulation of fund under Universal Service Obligation (USO) meant for improving rural teledensity and broadband. We want to bring in a set of rules on how this fund can be exhausted in an effective manner so that poorest of poor can be entrusted with telecom facility and broadband connections,” Raja said. The move would require a Cabinet approval. “We are moving towards that direction,” he added.

Early this year, Comptroller and Auditor General of India had pulled up DoT for not utilising funds of over `18,000 crore collected for promoting rural telephony and giving a false picture about the unused sums.

“A total universal levy of `26,163.96 crore was collected during 2002-03 to 2008-09 by DoT, but a disbursement of only `7,971.44 crore was made from the fund during the period,” CAG said in its report on the Union Government’s performance.

The closing balance of the USO fund as on March 31, 2009, the report said, should be `18,192.52 crore and not ‘nil’ as shown in the DoT accounts.

Raja said that 10,000 shareable mobile towers are proposed to be set up in rural India this year with the support of the USO Fund.

He said that during the past five years not only had urban tele-density risen from 26 per cent to over 125 per cent, but rural tele-density had also increased significantly from 1.73 per cent to over 27 per cent. With the active participation of the USO fund, village public telephones have already been provided in 5.66 lakh villages, out of a total of 5.93 lakh villages.

A day after the Supreme Court issued a notice to the Union Communication and Information Technology Minister A. Raja, the minister refuted the allegations saying that they are politically motivated. He refused to comment on the notice saying he has not seen them.

"Yes, there are some allegations against me," he told reporters on the sidelines of an event organised by the Federation of Indian Chambers of Commerce and Industry (FICCI). "No doubt it is politically motivated, with some vested interests in it of some corporate," Raja said.

"This is the result of a corporate war in telecom," Raja said. However, he refused to comment on the Supreme Court notice. "I haven't come across the Supreme Court order. Let there be an investigation," he said.

Lashing out at the media, Raja said it has always highlighted the controversy and not the good work and policy initiatives taken by him, which has made India one of the leading telecom markets in the world.

The Supreme Court on Monday had issued a notice to Raja on a petition alleging that he had connived with private telecom operators and "given away" scarce national resources in the form of 2G spectrum at "throw away prices" causing a loss of at least Rs 70,000 crore to the exchequer. The notice is returnable within 10 days.

The petition alleged that there were tapes of Raja talking to corporate middlemen. It said the department of telecom (DoT) arbitrarily changed the cut-off date for allocation of 2G spectrum licences under the firstcome, first-served policy and awarded the licences to just 120 of the 575 applicants.

The successful companies were then allowed to sell equity and conduct private auctions to "garner large sums", the petition said.

The Prime Minister’s Office has asked communications and home ministries to review the strict new security standards that are being labelled “too tough” by foreign telecom gearmakers.

Western vendors and business lobbies in the US, Europe and Japan are pressuring India to overturn the new rules that make it necessary for foreign equipment companies to put their software in the equivalent of a sealed envelope to be opened by Indian authorities only during a security threat. Both ministries have two months to decide whether a revised code of standards that is more aligned to procedures being followed globally is needed. “The DoT (Department of Telecom) is requested to examine, in consultation with MHA (ministry of home affairs), in the light of international best practice, some alternative mechanism in resolution to these issues needs to be put in place. This may kindly be concluded within a period of two months,” a PMO note to communications and home ministries (dated August 6) said.

So far only Chinese telecom gear vendors have offered to comply with India’s new norms unveiled in July-end hoping to bridge a trust deficit that has plagued their operations in the country and finally partake of a $100-billion market opportunity.

But Western vendors had raised strong objections and American business lobbies had enlisted the intervention of top figures in the Obama administration, including secretary of state Hillary Clinton, to challenge the new rules.

Some 20 trade groups from US and Europe had written identical letters to home minister P Chidambaram, telecoms minister A Raja, commerce minister Anand Sharma and the Prime Minister’s Office complaining that the new security norms were not consistent with global practices and that they had not been consulted during its formulation. Even Indian industry body FICCI had asked the PMO to defer implementing the clause in the new rules that required sharing the source code.

The rules, set by India’s security establishment also require vendors to employ only Indian nationals as engineers in the country. The norms also stipulate penalties of 100% of the contract value on mobile operators if any spyware or malware is found in their imported equipment. In the two-month interim period, the PMO has asked telecoms ministry to allow mobile phone companies and vendors to follow either the recently introduced norms or the security guidelines issued last year.

The rules issued last year do not mandate vendors to share their source codes in an escrow account in India. Instead, it allows mobile phone companies here to import networks and other related equipment after giving a self-certification of security compliance. But, several industry executives and even some mobile phone companies pointed out that the government had not cleared any imports from Chinese vendors under the old norms.

In fact, the telecoms ministry had even imposed an informal temporary ban on 26 companies, including top Chinese OEMs such as Lenovo, Huawei Technologies, ZTE Corp, Sunsea Telecom, UT Starcom, Tongyu Communications, Wuhan Fibrehome International , Shenzhen Grentech, Maipu Communications and a solitary Israeli telecom gearmaker, Comverse from supplying mobile gear in India. Since February 2010, about 450 orders worth over $2 billion placed by Indian mobile phone operators with these 26 companies had not been cleared.

It is also leant that mobile phone companies here such as Reliance Communications and Tatas fear that going back to the old norms will delay their expansion and rollout, especially that of 3G services, as equipment from Chinese vendors may not be cleared.

Even though Chinese equipment manufacturer ZTE has decided to abide by the government’s new security agreement, other equipment vendors do not seem to be keen on sharing their source codes and accept a penalty of 100% of contract value for security breaches.

Voicing concerns of these players, the Federation of Indian Chambers of Commerce and Industry (FICCI) has written a letter to the minister of communications and IT, A Raja, the prime ministers’ office (PMO) and the ministry of home affairs.

Rajan Bharti Mittal, FICCI president, who is also vice chairman & MD of Bharti Enterprises, has asked for an exemption of the proposal, that requires deposit of source code in the escrow account, stating that the source code is a valuable asset to the company and that ‘escrowing of source code is not a widely accepted international business practice’.

The FICCI Communications and Digital Economy Committee has also asked for 90 days to demonstrate alternatives to achieve the key objectives of the government, which is the protection of network to secure information.

Vendors including ZTE, Huawei, Ericsson, Motorola and Nokia Siemens Network, besides British Telecom, AT&T, Verizon, Qualcomm, Association of Unified Telecom Service Providers of India (AUSPI) and Cellular Operators Association of India (COAI) are said to be a part of the committee.

ZTE has agreed, AUSPI independently said they were also not against the proposed agreement and would not be writing to the government independently. Although views of all of the members in the committee could not be verified independently, the letter is said to reflect the consensus on the issue among the members.

FICCI added once the supplied products are certified by an independent agency, escrowing of source code may not be needed. Largely, the equipment vendors fear on losing out their trade secrets and intellectual property (IP) to competition, if placed in Escrow account.

A senior executive at one of the European vendors, said, “The government has not communicated how the deposition of source code in an Escrow account would help them reduce security threats. Moreover, we invest heavily on new technologies as compared to Chinese vendors and therefore, there is a concern on the IP being leaked.”

The committee has asked for a cap on the liability as a consequence of exceptional damages like special, incidental, remote damages, loss of profit, data or revenue only. However, this prescribed penalty should not be linked to every purchase order / procurement, it said. Further, the letter states that there should be a time limit in which these penalties could be executed.

The vendors do not want the telecom service providers to perform sudden inspections of their hardware, software, design, development, manufacturing facility and supply chain, at their own discretion. Instead the vendors and service providers should mutually agree to it and the checks should be with prior intimation, it said.

The Telecom Regulatory Authority of India (TRAI) has proposed to set up a National Optic Fibre Agency to roll out a backbone network across the country to boost broadband services. The National Agency will be set up through a consortium of operators according to the regulator's plan.

“We need to bring in national optical fibre network to increase broadband penetration. We can bring a combination of the National Rural Employment Guarantee Act, which can take care of the labour part; and the Universal Services Obligation Fund, for financing the cable part. This can be done through a National Optic Fibre Agency, a consortium of operators. Our proposal has been accepted and the Government is working on this,” said Dr J.S. Sarma, Chairman, TRAI, at meeting organised by FICCI on ‘The Road to Broadband — Investment and Innovation'. The TRAI is also set to release a consultation paper on the roll out of 4G spectrum and another paper on broadband.

“We will be ready with a consultation paper on 4G in a week and expect the regulations to be in place in the next few months,” Dr Sarma announced here today.

He said that the consultation paper will address issues such as adoption of an optical fibre network, cost of bandwidth, tariffs and the relationship between telecom service providers and internet service providers.

Mr Julius Genachowski, Chairman, FCC, emphasised the economic opportunities arising out of extending broadband to unserved areas, adding that there was a clear correlation between the adoption of broadband and increasing GDP. Broadband was also seen as a platform for solving the challenges of education, healthcare, public safety and environment.

He expressed concern over trends in the US indicating a widening gap between the supply of spectrum and the demand from mobile broadband 3G technology users. The US National Broadband Plan was focussing on decreasing the cost on investment through higher incentives and maximising the depth of infrastructure. It seeks to promote competition and transparency, public safety and accelerating the movement towards E-government.

The Telecom Regulatory Authority of India (TRAI) will soon be releasing a consultation paper on the roll out of 4G spectrum, even as the process of allocation of 3G radio waves to private operators is yet to begin after successful completion of the auction.

“We will ready with a consultation paper on 4G in a week and expect the regulations to be in place in the next few months,” said TRAI Chairman J. S. Sarma.

Addressing a meeting on ‘The road to broadband — investment and innovation', organised by the Federation of Indian Chambers of Commerce and Industry (FICCI), Mr. Sarma said the consultation paper would address issues such as adoption of an optic fibre network, cost of bandwidth, tariffs and the relationship between telecom service providers and internet service providers.

He further said the aim of TRAI was to make broadband an alternative model for the delivery of governance. “We would like to see that broadband is used for improving human development and giving a fillip to agriculture and social sector issues such as healthcare and education,” he added.

Speaking on the occasion, US telecom regulator Federal Communications Commission Chairman Julius Genachowski emphasised the economic opportunities arising out of extending broadband to unserved areas. There was a clear co-relation between the adoption of broadband and increasing GDP. Broadband was also seen as a platform for solving the challenges of education, healthcare, public safety and environment, he pointed out.

Mr. Genachowski expressed concern over trends in the U.S. indicating a widening gap between the supply of spectrum and the demand from mobile broadband 3G technology users. The U.S. National Broadband Plan was focussing on decreasing the cost on investment through higher incentives and maximising the depth of infrastructure. It seeks to promote competition and transparency, public safety and accelerating the movement towards e-governance, he added.

Communication channels between the telecom regulators of India and the US would be active over the next few months as India prepares for a broadband policy.

The visiting chief of the Federal Communications Commission (FCC) Julius Genachowski and the chairman of the Telecom Regulatory Authority of India (Trai) JS Sarma told a FICCI conference on Friday that they have already initiated a dialogue on the broadband roadmap.

FCC, which recently announced a national broadband plan for the US, has said that it would soon initiate a process intended to regulate broadband. Trai, which is expected to come out with a consultation paper on a broadband policy for India within a week, would issue recommendation on the subject in the next few months, Sarma said. India is seeking FCC views before coming out with its recommendations on the broadband policy.

Replying to a question on how Trai should approach broadband regulation, Genachowskisaid that a light touch approach would be sensible.

While broadband access is very limited in India at around 9 million, against mobile telephony subscriber base of over 600 million, United States is also facing broadband deficit. Around 10 per cent of the US population lives in areas without any broadband infrastructure, pointed out the FCC chairman. Even in places in the US with full broadband access, broadband adoption is only 65%, he added. “We would like itto go up to 100%,” Genachowskisaid.

According to the FCC chairman, non-adoption of broadband in the US was mainly due to the affordability factor, both for equipment and connection. Lack of knowledge of broadband and digital content was yet another reason for non-adoption, he pointed out.

The FCC chief has maintained that high speed internet was vital to America’s growth. The same is true for India, ministers and bureaucrats have reiterated.

National broadband is a priority for the Obama administration. This would help in creating jobs, increasing investment, and improving access to education and health care. India too has a similar agenda.

India is, at this point, holding spectrum auction for offering broadband wireless access (BWA) service. Once BWA service is rolled out, broadband in India is expected to get a boost. Recently, India completed the 3G auction process that would fetch the government around Rs 67,000 crore.

Telecom regulator Trai, on Friday, said it is planning to come out with a comprehensive consultation paper on broadband Internet services in next 10 days to improve broadband penetration in the country.

The move comes at a time when the auction process for Broadband Wireless Access (BWA) spectrum is going on. “We are planning to come out with a consultation paper on broadband in next 10 days ... We will further try to hasten it and try to ready with the recommendations and regulations in next few months,” Chairman J S Sarma told reporters on the sideline of a FICCI conference.

The issues that would be broadly covered would include laying of optic fibre cables, getting access to USO fund among others, he added.

Speaking on ‘The Road to Broadband — Investment & Innovation’, Sarma said Trai would aim at making broadband an alternative model for the delivery of governance.

While the country boasts of having about 600 million mobile phone users, there are about nine million broadband subscribers.

The government is auctioning two slots of 20 MHz of pan- Indian BWA spectrum.

Trai intends to elicit the views of various stakeholders on the issue.

The 3G/BWA auctions and the resultant commercial activity that will be generated in India — the world's fastest growing telecom market — has stirred up expansion and M&A activity in the telecom consulting space with London-based Analysys Mason acquiring BDA Connect's India business.

This is a strong signal that the next two years will see hectic rearrangement of India's competitive landscape in the telecom space. Analysys Mason is learnt to have some of the largest telcos in its client list including those invested in India as well as others that are planning an India entry.

The size of the telecom management and strategy consulting business in India is estimated at roughly $100 million with an over 25% growth rate. This rate is expected to accelerate as a result of fresh financial and commercial activity generated through the auctions. Each telecom firm works closely with more than one consulting company for a variety of their internal requirements and many are being used as advisors in the current 3G spectrum auctions.

Analysys Mason offers strategy advice, operations support, and market intelligence. It employs over 250 people worldwide, with offices in Cambridge, Dubai, Dublin, Edinburgh, Madrid, Manchester, Milan, Paris, Singapore and Washington.

Analysys Mason is acquiring the BDA India team, which consists of 16 professionals with significant experience in strategy consulting in telecom and technology. The team has been working closely with international carriers, original equipment manufacturers (OEMs), and value-added service (VAS) companies on market entry and growth strategy, and also has important engagements with FICCI and CII.

The acquisition gives Analysys Mason an entry to the Indian market and also enhances its capability to increase its footprint across Asia. For BDA India, it brings Analysys Mason's expertise on issues, such as realizing the potential of broadband to India, at this critical point in the markets development.

Kunal Bajaj, MD of BDA India confirmed the development but declined to reveal the acquisition value. Bajaj will take on the role of director, India at Analysys Mason.

Apart from this, E&Y has recently brought in a new Partner from IBM to head telecom strategy, while IBM is scouting for a new telecom consulting and operations head. It is learnt that both PWC & KPMG are expanding their teams and strength in this area at senior levels. Arpita Agarwal, who recently moved from PwC to KPMG as a Partner, is a visible testimonial of this activity. “The sheer size of the telecom industry with the 3G auctions and ensuing consolidation that is expected to follow, points to the need for telcos to increasingly seek external help on a variety of issues", says Agarwal.

Leading telecommunications carrier Bharti Airtel will work with its existing equipment suppliers when it builds its 3G mobile network following a long-delayed auction, a top executive said.

Rajan Bharti Mittal, a director on the company's board, also said he saw no regulatory obstacles to Bharti Airtel's pending $9 billion purchase of the African assets of Kuwait's Zain, which would make Bharti one of world's top five mobile companies by subscribers.

On Friday, India kicked off its long-delayed 3G spectrum auction in which nine carriers are vying for licenses to build third-generation (3G) mobile networks in parts or all of India, touching off a multi-billion-dollar spending spree by the likes of Bharti and Reliance Communications.

"We have our vendor partners, as you know," Mittal, sibling of Bharti Airtel's billionaire founder Sunil Bharti Mittal, told Reuters in an interview on Saturday, on the sidelines of the Boao Forum on southern China's Hainan island.

Mittal, who is also managing director of the telecom operator's parent, Bharti Enterprises, named Sweden's Ericsson and Nokia Siemens Networks as two of Bharti Airtel's partners.

Ericsson said in March that it had won a $1.3 billion network expansion contract to upgrade Bharti Airtel's GSM network, while Nokia Siemens in February won a $700 million deal from Bharti.

"For 3G, we will go back to existing relationships and we will have to figure it out," Mittal said.

"We always have and we like to maintain", he said, referring to relationships with existing vendors.

3G beckons

The spectrum auction is expected to take about two weeks to complete, but companies will be allotted spectrum by September, meaning commercial launches of premium services such as faster internet on mobile phones and video calling will be possible only next year.

Bharti Airtel earlier said it would be able to launch 3G services within six to eight months of receiving spectrum allocation.

"We are quite ready as a company to start the roll out if we have the spectrum," Mittal said on Saturday. "As the younger generation is getting much more on the data, 3G will help in us bring that (to them)."

Data services account for just over 10 per cent of revenue for Indian telecoms providers, according to researcher Gartner, but Bharti Airtel is betting on increased revenue from services such as mobile commerce, as voice prices fall sharply.

"For us, value-added services are a driver and we look forward to (3G) enhancing that," Mittal said.

Zain deal: 'Work is on'

Bharti, 32 per cent owned by Singapore Telecommunications Ltd, selected Zain as its second choice for building a major presence in Africa, after it twice failed to finalise tie-ups with South Africa's MTN Group Ltd, the continent's biggest operator.

The deal will give Bharti 42 million subscribers in 15 African countries, but must still be cleared by regulators. In late March, the government in one of Zain's markets weighed in against the deal, but Bharti signed a legally binding agreement with Zain the next day.

"The work is on," Mittal said of the deal, adding that he did not expect any other major hurdles. "This is pretty much a straight-forward deal."

Bharti Airtel will ink a definitive agreement with Kuwaiti telco Zain to buy its African assets in a deal valued at $10.7 billion within the next 10 days, Bharti Enterprises vice-chairman and managing director Rajan Bharti Mittal said.

“Zain board has accepted our offer. The Bharti board has also approved it. March 25 was the deadline for the exclusivity period to end. Now, we have a few days to complete the exercise. Definitive agreements have to be signed,” he said.

Mr Mittal, president of industry body Ficci, was in Helsinki as part of a business delegation lead by commerce minister Anand Sharma.

He also said that all aspects of the deal have been tied-up and the telcos were close to addressing issues arising out of due-diligence of Zain’s African assets. The Indian telecom player will have to pay $8.3 billion to Zain in three months after the deal is signed and $700 million within a year. It has arranged for a loan worth $7.5 billion from a host of international banks and SBI.

Bharti said in a statement on Thursday that it had completed the due diligence. “Further to our announcement regarding the acquisition of Zain Africa, we would like to report that the due diligence has been completed. Bharti is now working with Zain towards finalising the definitive agreements which will address all key terms and findings arising out of the due diligence. Definitive agreements are expected to be signed soon,” the company said.

The $10.7-billion deal for Zain’s operations in 15 countries will give Bharti a firm foothold in the African market and take it past China Unicom, Sweden’s TeliaSonera, and Germany’s TMobile as the world’s seventh-largest mobile phone company by subscribers. The Bharti-Zain combine will have revenues of $13 billion and earnings before interest, taxes, depreciation and amortisation of around $5 billion.

Bharti today said it hoped to sign the $10.7-billion deal to acquire the African assets of Kuwait's telecom firm Zain in the next 10 days.

"Hopefully," said Bharti Enterprises vice-chairman and managing director Rajan Bharti Mittal when asked whether the agreement with Zain would be inked in next 8-10 days.

"The Zain board has accepted our offer. Our board has approved it. The exclusivity ended and now we have a few days to complete the exercise. Definitive agreements have to be signed," he said. March 25 was the deadline set for exclusivity.

He said the due-diligence was almost in the last stage to acquire the African assets of Kuwait-based Zain Telecom and thereafter the process had to follow.

Yesterday, Airtel had said, "Bharti is now working with Zain towards finalising the definitive agreements which would address all key terms and findings arising out of the due diligence." Bharti Enterprises is the holding company of Bharti Airtel.

The deal, once happens, will pave the way for one of the largest telecom cross-border deals and will give Bharti access to 15 African countries at one go. The two businesses combine will have more than 165 million subscribers with total revenue of $13 billion.

Bharti has been keen on entering the African market. In the past two years, it has twice attempted a merger with South Africa-based MTN.

Twice bitten, Bharti Airtel will shy away from making any more moves at acquiring South African telecom giant MTN, although it will continue to look at other take over targets, especially state-run telecom firms in emerging markets.

“The MTN chapter is now closed,” said Rajan Mittal, vice-chairman & MD of Bharti Enterprises, adding that Bharti Airtel’s recent acquisition of Warid Telecom in Bangladesh demonstrated the company’s intention to tap business opportunities in emerging markets.

“This is a continent (Asia) that attracts us,” Mr Mittal said. Bharti Enterprises is the parent company of Bharti Airtel, India’s largest private telecom operator by subscribers as well as revenues.

Mr Mittal was speaking to journalists on the sidelines of Indo-West Africa business forum organised by the Indian government and industry body FICCI.

Refusing to divulge if Bharti was currently in talks with any telcos, Mr Mittal clarified that Bharti would bid only for companies offering mobile telephony, and not fixed-line services.

For Bharti, whose international operations include Sri Lanka, Seychelles and Jersey islands in Europe, expanding abroad is vital since urban India is close to reaching a saturation point. Teledensity in cities, towns and metros has crossed 100% and revenues and profits of all Indian telcos are under severe pressure as they engage in a savage price war.

With close to 120 million customers, Bharti remains a clear leader in the Indian mobile industry, but its pace of customer additions is slowing and its market share is under threat from new players launching services at the lowest possible tariffs.

Bharti’s revenues grew at the slowest pace in six years in the quarter ended September 2009 and sales and profits are forecast to fall further in the December quarter.

Around 13 mobile firms are jostling for business in a market, which telecom analysts say, can support only 4-5 operators. Three more companies are due to launch services soon, portending fiercer battles to win and keep customers.

Following the failure of the MTN deal, Bharti has been linked to several operators, including Kuwait’s Zain and Egypt’s Orascom, as both these operators have significant presence in markets across Africa and Asia.

Last week, Bharti Airtel had announced the elevation of Sanjay Kapoor as its CEO for India and South Asia, placing him to lead the charge in the increasingly cutthroat domestic mobile market, and moved incumbent Manoj Kohli to a new role spearheading the global expansion of the country’s largest telecom group. From April 1, Mr Kohli will head a newly created international business division.

Indian telecom major Bharti Airtel, which is expanding its mobile telephone operations outside the country, is keen on picking up stake in public sector telecom companies in Africa and and other developing countries through the disinvestment process.

“We are certainly looking at picking up stakes offered through disinvestment by the Governments in any developing country, including in the African continent. But if it is only about fixed lines, our answer will be ‘no' as the fixed line revolution has gone by. We are mainly led by mobile services and are interested in the mobile sector,” Mr Rajan Bharti Mittal, Vice-Chairman and Managing Director, Bharti Enterprises Ltd, told reporters on the sidelines of the recently held FICCI-event Namaskar Africa.

Bharti Airtel is the flagship company of Bharti Enterprises.

Terming the talks on Bharti Airtel's plan on a $24-billion merger with South African company MTN as a ‘closed chapter', Mr Mittal, however, said “We are always on the look out for new opportunities and target companies. Given an opportunity, we would like to enter the telecom sector in Africa and in other international markets.”

“This (Africa) is a continent that attracts us. Pricing is very high here. After some privatisation, the telecom sector as a whole and even the public sector companies are in a better shape in Africa,” Mr Mittal said.

However, it is still a long way to go as networks are not in the best of shape and call drops are frequent in many parts of Africa, Mr Mittal, who is also the FICCI President-elect, said.

Opportunity in Nigeria

On the proposed sale of the Nigerian Telecommunications Ltd (Nitel) and its mobile subsidiary company Nigerian Mobile Communications Ltd, he said, “Nitel is a predominantly fixed line company, which also has a licence to offer mobile services.

Companies that are into fixed line have never been able to offer good services in the mobile sector unless they are early entrants.”

But Nigeria is also an attractive market with a population of over 150 million, Mr Mittal said.

Incidentally, Nigeria is looking to attract $10 billion worth investments from India in the next five years, including in sectors like telecom.

Bharti had recently inked an agreement to take a 70 per cent stake in Warid Telecom, the fourth largest telecom operator in Bangladesh, from the Dhabi Group for $300 million.

Following its success in India, it had made its first venture in mobile services outside the country in Sri Lanka last January.

The Bharti group, which has just acquired a majority stake in the Bangladeshi mobile operator Warid Telecom, is on the lookout to acquire government-owned telcos in developing countries like Africa which are up for divestment.

"If the government in any other developing country like Africa, Bangladesh etc are looking for disinvestment in PSU telcos then it can be looked at. But it would only be in mobile services and not in fixed lines," Bharti Enterprises managing director Rajan Bharti Mittal told reporters on the sidelines of a Ministry of Commerce and FICCI event here.

Reflecting on the failure of his company's talks with South African telco MTN twice, he said, "you always have a look out. MTN (which also holds Nigeria) did not happen. But if given an opportunity, we will look at it."

Mittal, however, ruled out any fresh talks with MTN saying, "that chapter is closed. But we are always going to look at new opportunities.

"As you are aware, we have just done the Bangladesh deal. We want to go into a continent and this is a continent that attracts us."

Bharti last week signed a pact to acquire 70 per cent stake in Bangladesh's fourth largest telco Warid Telecom from the Dhabi Group for $300 million.

Bharti's first foray outside the country was Sri Lanka where it entered last January.

Bharti Airtel chief executive Manoj Kohli had already said that his company's only strategy is to focus on emerging markets and not any big or small buys.

Even as the rural market is growing attractive for India's telecom industry, the operators face several challenges in rural penetration like illiteracy and low revenue per user, according to a report.

"Despite the inherent attractiveness of the rural market for telecom operators, several challenges in going rural stare the operators in their face," said the report jointly prepared by the Federation of Indian Chambers of Commerce and Industry (FICCI) and global consultancy KPMG.

The challenges include difficulty in the acquisition of rural consumers due to the low affordability of telecom services, the low average revenue per user (ARPU), lack of locally relevant content and the prevalent literacy levels, said the report.

Though the cost of owning and using telecom equipment and services has come down considerably in the last few years, the rural consumer still finds it hard to put aside money for "discretionary spend".

To overcome this challenge, the report suggested that micro-financing could provide a possible solution.

"Tie-ups with state-owned banks could enable the rural consumers to purchase telecom equipment and services at affordable rates," it said. The rural ARPU is not expected to be driven solely through voice services. The availability of data services is expected to have a positive impact on the rural ARPUs, FICCI said.

The report also cited lack of locally relevant content for restricting rural telecom.

To increase adoption, the report stated that it was essential to develop services like news in local language, weather alerts for fishermen, and comparative 'mandi' rates, among other services. It added: "To derive maximum benefits from these services, it is essential for the consumers to have basic reading and writing skills in place."

In addition to above challenges, infrastructure-related roadblocks lead to a steep escalation in costs, reducing the attractiveness of the rural market, said the report.

Despite the inherent attractiveness of the rural market for telecom operators various challenges still mar their entry.

A report by the Federation of Indian Chambers of Commerce and Industry (FICCI) and KPMG reveal that although the cost of owning and using telecom equipment and services has come down considerably in the past few years, the typical rural consumer finds it hard to put aside money for what is still believed to be a discretionary spend.Difficulty in acquisition of rural consumers due to affordability of telecom services, low average revenue per user (ARPU) among rural consumers, lack of locally relevant content, infrastructure and low literacy levels are major hurdles.

The report suggests microfinance and collaboration between state-owned banks and operators as a solution. More, to combat low subscriber base and a low-volume rural market, the report suggests rural ARPU not be driven solely through voice services but with other data services. Development of services like news in the local language, weather alerts for fishermen and comparative ‘mandi’ rates will enhance the customer base.

Moreover, the telecom setup requires large amounts of land for setting up infrastructure elements like Base Transceiver Stations (BTS). In many cases, the land is owned by government bodies or gram panchayats, and the process of leasing or purchasing of land is arduous and expensive. Laying of cable or fibre in rural areas often goes across multiple jurisdictions. This involves obtaining the requisite approvals and permissions from multiple authorities, which become time-consuming and difficult. Other inhibiting factors are limited availability of skilled workforce, poor road connectivity and irregular power supply. The FICCI-KPMG report suggests the high costs associated with the setting up of rural infrastructure could be addressed through sharing between telecom players. This model, it says, has been fairly successful in urban areas, but is yet to pick up traction in rural areas.

In order to give an impetus to telecom infrastructure in the rural areas the Government is planning to amend the Universal Service Obligation Funds (USOF) to make it easier for telecom companies to access the funds. This was announced by the Minister of Communications and Information Technology, Mr A. Raja.

Mr Raja was speaking at the curtain raiser for India Telecom 2009, jointly organised by FICCI (Federation of Indian Chambers of Commerce and Industry) and the Ministry of Communication and Information Technology. He said, “USOF is being leveraged extensively to give a further push towards telecom infrastructure in the rural areas. 6500 mobile towers with subsidy support from USOF have already started radiating. USOF is also coming up with various schemes including laying of dark fibre in a big way for creating adequate backhaul infrastructure in rural areas.”

The Minister also added that with the continued participation of the private sector, Government’s target of reaching 40 per cent tele-density will be achieved well before 2014.

Earlier at the event, Mr Sachin Pilot, Minister of State for Communications and Information Technology said, “Our concern is to bridge the gap between urban and rural tele-density ration which currently stands at 1:5. Rural subscribers need more than just voice services.

Provision of broadband services in rural areas would have a multiplier effect.”

Regarding the auctioning of spectrum for 3G and BWA (Broadband Wireless Access) services, the Minister said that the process of auction is slated for completion by February 2010.

Telecom scam

The Telecom Minister on Friday hit out against the Bhartiya Janata Party. Alleging that the National Democratic Alliance NDA regime had distributed 250 Mhz of spectrum for free, Mr Raja said, “The NDA Government is responsible for irrational decisions without any legal backing. The scam during the NDA regime could be much more than Rs 1.6 lakh crore.” Mr Raja facing allegations, of a Rs 60,000-crore spectrum scam, from the BJP said that he will not resign. “Ours is a Government that has followed all rules to the letter and spirit by following the regulations of the Telecom Regulatory Authority of India,” he said.

Communications and Information Technology Minister A. Raja on Friday said the Central government would soon amend the Universal Service Obligation (USO) Fund rules to make it easier for telecom companies to access over Rs.16,000-crore corpus lying with the government to push rural telephony.

“The USO Fund rules are being amended to make it more flexible and help boost in rural telephony. The new rules will give telecom companies quick access to the fund and help in increasing rural tele-density,” Mr. Raja said during a curtain raiser of India Telecom 2009, organised by FICCI here.

Over Rs.16,000 crore of USO Fund lie unused with the consolidated Fund of India because the rules governing the release of the fund are too rigid. The Fund was initially established with the fundamental objective of providing access to basic telegraph services in the rural and remote areas.

Subsequently, an Act was passed in 2006 -- the Indian Telegraph (Amendment) Act 2006 -- to amend the Indian Telegraph Act of 1885, to enable provision of all types of telegraph services. The rules were further amended in order to enable support for mobile services and broadband connectivity in rural and remote areas as the Indian Telegraph (Amendment) Rules 2006.

As telecom operators in the country struggle with decline in earnings per user, the next level of voice and internet services — 3G and Broadband Wireless Access (BWA) — is expected to account for almost half the revenues from wireless services four years down the line.

According to a study by industry association Federation of Indian Chambers of Commerce and Industry (Ficci) and telecom consulting firm BDA, 3G revenues in the country will reach $15.8 billion, 46 per cent of the total wireless revenue, by 2013.

The 3G subscriber base is expected to reach 90 million in five years. This will be 12 per cent of the total telecom subscriber base of 746 million.

“We had tabulated these numbers before the delay in the 3G auctions, so we assumed that 3G services would be rolled out by private operators by July 2009. But we’re hopeful that the government will carry out the auctions as soon as possible to reach the estimated number,” said Kunal Bajaj, managing director, BDA Consulting.

“Telecom carriers are facing declining margins per minute and deteriorating quality of service in urban areas. Given that 9 per cent subscribers contribute 29 per cent of revenues and 45 per cent of carriers’ margins, the introduction of 3G will help carriers migrate high-revenue customers to the new 3G network, with no congestion, and accommodate incremental subscribers on their 2G networks,” added Bajaj.

In the Indian market, which is predominantly voice-based, 3G will help increase the contribution of non-voice services like SMS and data card access to 23 per cent from 9 per cent at present, says the study.

Introduction of 3G services is also predicted to lift the revenues of the manufacturers of 3G devices. According to the study, revenues from sale of 3G devices are expected to be $11.2 billion with the high-price segment, that is, handsets above $200, contributing to 59 per cent of annual sales revenues. Driven by the demand in the replacement market, the annual sale of 3G devices is expected to cross 81 million, according to the study. However, it will pave the way for handset bundling across the board, it says.

The study estimates the broadband subscriber base in the country to increase over nine-fold in the next five years to 46.5 million, with a personal computer base of 75 million. Of the total, the number of 3G subscribers is expected to reach 22.4 million by 2013 with the sale of 13.6 million new modems (including data cards, routers and USB dongles) in the same year.

The Department of Telecom on Monday said that there will be clarity on the auction dates for third generation mobile phones by next week.

Speaking at the launch of a report by ICRIER on the impact of mobile phones, Mr Siddhartha Behura, Secretary, DoT, also said that the existing spectrum allocation policy needed a review.

“Most of the countries have given 15-20 Mhz spectrum to each operator. Here we are giving only 6.2 Mhz. These are legacy issues which need to be addressed. The quality of service is getting impacted due to the spectrum crunch. But operators need to focus on improving quality instead of adding more subscribers.”

Mr Behura also admitted that the Universal Services Obligation policy has not succeeded in achieving the results.

Later in the day addressing a seminar on 3G and broadband organised by FICCI, Mr Behura said DoT was optimistic of completing the auction within the current financial year.

New schedule

“We have not been able to keep to timeline which was originally scheduled. This kind of tight schedule has not been attempted anywhere in the world. Operators also wanted it later though I must confess that is not the only reason for the delay. As soon as clarity emerges in a week, we will be able to give a new schedule,” he said.

DoT had earlier announced that the auctions would take place on January 16 and then postponed it to January 30. However, since the Cabinet Committee On Economic Affairs is yet to approve the 3G policy, DoT had to push back the dates indefinitely.

Mr Behura said 3G services were launched with the aim of stimulating and maximising revenue generation and will substantially enhance the average revenue per user for telecom services providers.

Responding to a demand from FICCI that the government needs to lower duties on telecom and IT equipment to increase broadband penetration in the country, Mr Behura said DoT hoped to persuade the Finance Ministry to lower such duties.

The government on Monday (January 19) said it will have some “clarity” on the timeline for the auction of 3G spectrum, which has been deferred twice now, within a week, even as it declined to give a set timeline for the bidding.

“We will have some clarity on the issue (auction of third generation radio waves) by the next week…,” Telecom Secretary Siddhartha Behura said on the sidelines of a FICCI event.

The auction process for the 3G spectrum has already been deferred twice. First, it was scheduled to take place on December 15 last year but was deferred to January 30. However, the auction process got postponed again as the finance ministry wanted to double the reserve price for all-India 3G licence from Rs 2,020 crore to Rs 4,040 crore.

In view of the Finance Ministry’s suggestion, the Department of Telecom (DoT) had to refer the matter to the Cabinet Committee of Economic Affairs for a wider view before deciding on the 3G spectrum price.

Telecom players are, however, not complaining about the delay as it gives them more time to arrange money for the auction considering the present downturn in the economy.

Behura added that during the pre-bid conference telecom operators had asked for some more time.

Earlier in the day, attending another function the telecom secretary told reporters that the government had still not set any timeline for conducting the auction process.

The Institute of Chartered Accountants of India (ICAI) on Wednesday declared that any member found guilty in the financial wrongdoings by Satyam Computer Services would be punished severely and the errant auditors could even be barred for life from practising.

Following the revelation of financial wrongdoings by the country’s fourth largest IT major, ICAI president Ved Jain said: “We will ensure that to any person who has not worked according to our standards and our expectations, severe punishment be given.”

The role of the auditors and accountants of the Hyderabad-based company have come under the lens following Satyam Chairman B. Ramalinga Raju’s letter accepting that he had misrepresented facts in the company’s balance sheet. Satyam’s auditors PricewaterhouseCoopers (PWC), however, declined to comment on the issue and ICAI’s warning.

Mr. Jain, however, pointed out that the ICAI needed to collect all the facts and data on Satyam’s accounts before taking any action against the members involved in the fraud. On the possible action against the “guilty” auditors or others involved , Mr. Jain said any person party to a fraud or cheating could be convicted under the country’s penal code. “All one needs to prove is he was the party to the fraud. He can be booked under the Companies Act and the Chartered Accountants Act ... in case of negligence by the chartered accountant, we have a severe punishment,” he said.

Commenting on the issue, apex company secretaries institute the ICSI said the organisation was not in the picture in the current juncture. “If any member is found guilty, we will deal with it according to the company secretaries law,” ICSI president Keyoor Bakshi said.

Corporates expressed deep shock and asked the government to plug loopholes in corporate governance so that the confidence of companies and investors, particularly global, could be restored in the Indian corporate sector.

Nasscom’s plea

Terming it as a ‘stand-alone’ case of corporate governance failure, the apex body of IT and BPO industry, the Nasscom, said: “This is not in any manner a reflection on the industry or corporate India. We will ensure that customers and other stakeholders get the right perspective. We will also work with the Satyam taskforce to reach out to their customers and employees and guide them through the transition.”

Chambers’ reaction

Similarly, top apex chambers have urged government and regulatory authorities to take immediate corrective measures.

“Satyam was always seen as one of the top Indian IT companies and often represented as shining example of Indian liberalisation and entrepreneurship. This fraud on the investors and employees of the company shows a systemic breakdown in audit and board’s oversight of the company,” said Rajeev Chandrasekhar, MP and President, FICCI.

The CII called for immediate examination of the loopholes in regulation, accounting, audit and governance. The Assocham demanded a special committee to be set up to investigate the entire Satyam issue so that culprits are identified and brought to book.