CAG has more things to say on 2G spectrum

The Comptroller and Auditor General (CAG), whose report has forced DMK leader A Raja to quit Union Telecom Ministry for causing an unprecedented loss to the national exchequer,
said norms were violated on the issue of licences and allocation of 2G spectrum.

The CAG report said nine operators, such as Bharti, Idea, RCOM and MTNL, were allotted spectrum beyond the upper limit set in the licence agreement.

The report said the Government could have earned additional revenue of up to Rs 37,000 crore if the companies were asked to pay for additional spectrum being held by them.

?Thus, while the DOT, on one hand, was not processing pending applications for licence due to non-availability of spectrum, on the other hand it was allotting spectrum to existing operators beyond the contracted limit without any upfront charges being imposed or without determination of market price of spectrum,? the report said.

The value of spectrum held by 13 operators for 51 circles based on the 2001 rates worked out to Rs 2,561 crore.

The value of additional spectrum held would be in the range of Rs 12,000 crore and Rs 37,000 crore, it was estimated .

The Telecom Regulatory Authority of India’s recommendations for charging this additional spectrum has not been accepted by the Government so far.

The technical committee appointed by the Telecom Ministry recommended in May 2009 that the additional spectrum assigned beyond 6.2+6.2Mhz in a service area should attract an upfront charge equivalent to 3G price.