Wednesday, 30 May 2012

TRAI chief defends 2G spectrums pricing at JPC

The new Chairman of Telecom Regulatory Authority of India on 29 May 2012 defended its 2G spectrum proposals at a meeting of the Joint Parliamentary Committee. 
Telecom Commission has asked TRAI to give an analysis on the impact of its pricing proposal. Telecom companies, which are protesting against the TRAI proposals, were hoping for a review. 

The telecom companies are giving the arguments that if the pricing recommended by TRAI is implemented, it would result in increase in mobile charges. But TRAI contested this argument at JPC meeting today on May 30th 2012 explaining that the new set of recommendations was a result of an extensive field study. 
TRAI had suggested a base price of Rs 3,622 crore per megahertz for the 1800 Mhz band. Dr Khullar is learnt to have told the panel that the amount is 10 times the price paid by operators in 2008. Members said they will ask the Chairman why such an amount was not suggested in 2008, when the 2G spectrum was sold on first-come-first-served basis. 
Dr Khullar contested the telecom companies' claims that the decision will impact the consumers as the prices are likely to increase. 
According to TRAI calculations if implemented, these recommendations could result in a maximum increase of five paisa for a call in the next 20 years. Calculations made by the regulator maintained that the per minute cost impact (including interest) reduces from Re 0.044 per minute in 2012-13 to Re 0.017 per minute in 2031-32. 
Apart from telecom companies, the Commerce Minister, Mr Anand Sharma, and the Telecom Commission had also questioned the new spectrum recommendations by TRAI.


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