FROM BUSINESS WORLD OF 12 JULY 2006.
A regulator emasculated
A regulator emasculated
Prospects of a cabinet reshuffle are
casting various reflections. Who are going to be moved or dropped? Only the PM
and the President (I mean of the Congress) know. Who think they are going to be
shifted? The best indicator of this is what I call the CPI or the Compulsive
Proximity Index. Go to public occasions to be attended by Sonia Gandhi,
preferably one where people can move about – such as a book launch on the lawns
of Flagstaff House, once the residence of the Commander-in-Chief of the Indian
Army, now known as Teen Murti House. Measure the average distance maintained by
a minister between Sonia Gandhi and himself. Correlate the direction of
movements of Sonia Gandhi and the ministers. The shorter the average distance,
and the higher the correlation between the directions, the more insecure the
minister. It is some time since I did this exercise, for these open-air
occasions decline in summer. But the last time I undertook the measurements,
Shivraj Patil emerged champion.
Then there is
the question: who should be reshuffled? The answer, to my mind, is clear and
urgent: Dayanidhi Maran. Not that he has performed particularly badly, or that
he has stepped out of line. In fact, if one looks through the list of his predecessors
– who include such personages as Sukh Ram and Jagmohan – he is following well
known precedents.
He is minister
of telecommunications – an especially covetable department from a certain
ministerial point of view. Amongst the enterprises controlled by this
department are two huge ones – BSNL and MTNL.
There was a time
when Department of Telecommunications had a monopoly and maintained a permanent
shortage of telephones. At that time, a minister who kept on its right side
could oblige his friends, benefactors and beneficiaries with telephones. It was
a valuable privilege that many a politician would have given his life for.
Nowadays DoT’s companies have private competitors, so one can simply walk
across the street and get a telephone from a corner shop. So a minister is not
so sought after. But still, DoT controls enormous capital budgets and lucrative
appointments.
A minister that
does its bidding can achieve much happiness; one who tries to bring it to heel
would have to be unusually strong-minded and uninterested in the material
world. The only minister who fulfilled these qualifications in recent past was
Arun Shourie. He appointed his telecommunications secretary chairman of TRAI.
Between the two they tried to sort out the mess created by previous ministers.
With the active help of DoT, they had created a licence regime which gave
private operators very limited territories whereas BSNL, DoT’s aged baby, could
operate across all circles and services. This unequal competition led to
periodic crises. Shourie’s and Baijal’s solution was abolition of boundaries
between licences – a single universal licence for all services.
Luckily for DoT,
the NDA government was turfed out before the two could do material damage, and
DoT got the personable, youthful, reasonable Dayanidhi Maran as minister. It
has never looked back since. TRAI has continued to work on a unified licence
regime. But it is wasting its time: the minister is not interested. For if
licences were unified, which private operator would come and kowtow before the
minister?
In July 2004,
TRAI put out the idea of a common interconnection exchange. The idea was
simple. If there were n operators, they would need n(n-1) interconnections if
calls were to pass directly from any operator to any other. But if there was a
common interconnection exchange, the number would fall to n. A great idea; but
it would displace BSNL as the interconnector. So the minister sat on it.
On the
ministry’s reference, TRAI produced proposals last November for allocation,
utilization, pricing, trading and management of wireless spectrum, which is
crucial to mobiles, radio, television and broadband. The present system is that
a captive committee of DoT allocates spectrum – which it finds very convenient.
TRAI suggested a fairer, more objective and more efficient system. DoT’s
response was a deafening silence. To nudge it into action, TRAI produced
another paper last May. The result – a dark frown from DoT.
In these
sinister games against the regulator, the minister is a willing and
enthusiastic collaborator. If anyone wants evidence, he should go through the
files sent to Maran by TRAI. The chairman of TRAI this year is chairman of the
international association of telecom regulators. He should be hosting their
annual conference in India. Maran has not allowed Baijal to travel abroad; nor
has he approved the conference. These are petty intrigues worthy of DoT; but
they bring nothing but disgrace to Manmohan Singh’s government.
