The chief executives of India’s largest telecoms companies will meet the government
The chief executives of India’s largest telecoms companies will meet the government on Tuesday to try to rebuild confidence in a sector drowning in corruption allegations and bristling with hostility between operators.
The crucial meeting between top executives and Kapil Sibal, the telecoms minister, comes as India’s ruling Congress party faces the loss of a key southern coalition partner, which had formerly held responsibility for the controversial telecoms ministry.
Over the weekend, the Dravida Munnetra Kazhagam, a regional party, threatened to withdraw its six ministers from the ruling United Progressive Alliance, in a row over how many seats it and the Congress party would contest in Tamil Nadu state elections next month.
Tensions between New Delhi and the DMK have been at near boiling point since the resignation of Andimuthu Raja, a DMK politician, as telecoms minister, after an official audit claimed the national exchequer could have lost as much as $39bn in revenues in the award of 2G telecoms licences in 2008.
The audit sparked a furore that paralysed parliament and has threatened to embarrass Manmohan Singh, India’s prime minister, amid claims by the opposition that he turned a blind eye to the conduct of the telecoms ministry.
It has also sullied India’s reputation as an attractive fast-growing emerging economy that welcomes foreign capital.
Mr Sibal, a senior Congress party politician and a lawyer, took charge of the telecoms portfolio last year to try to stabilise the sector after the damaging corruption allegations came to light.
In Tuesday’s meeting with executives of companies such as Bharti Airtel, Vodafone, Reliance Communications and Tata Communications, the minister will hope to strike a truce in what some senior business people describe as a long-running “telecoms wars” between powerful operators that have been encouraged by weak regulation.
Mr Sibal will try to reach consensus on licensing and spectrum allocation, in an attempt to bring stability to a sector that has quickly gone from being one of India’s most feted to being one mired in scandal.
He may also discuss what redress should be made for the alleged irregularities that took place in the 2008 spectrum auction, and licensing violations.
Mr Sibal’s agenda includes proposals on spectrum pricing and sharing, and capping the amount of spectrum telecoms companies can hold.
Telecoms companies are likely to respond by stepping up their lobbying to insist on fair treatment. Others fear that an intensifying investigation by the Central Bureau of Investigation, which has already questioned Mr Raja, officials in Tamil Nadu and Anil Ambani, the chairman of Reliance ADAG, may also call in other senior business leaders.
via TheFinancialTimes