No foul play in UASL: DoT to Idea

MUMBAI: The Aditya Birla group may be of the view that their telecom arm Idea Cellular has suffered due to the erstwhile joint venture partners, the Tatas, but the department of telecom (DoT) feels otherwise. While noting Idea’s contention that it has been severely disadvantaged over the past four years, DoT has said that there has been no discrimination in the grant of unified access service licences (UASL), which have been given on a first-come, first-served basis.

Official sources said that no operator, whose applications were received after Idea Cellular, have been granted UASL. “The policies for issue of new UASL and migration of basic operators to UASL are applicable to all applicants equally without any discrimination,” DoT said.

Idea Cellular MD Sanjeev Aga declined to comment. On June 26, 2006, six days after Tatas sold their 48.14% stake in Idea, the company applied for licences in nine new circles of Karnataka, West Bengal, North-East, Kolkata, Tamil Nadu, Assam, Punjab, Orissa and Jammu & Kashmir. It has not been granted licences in any of these circles till now.
Idea also claims that despite having a prior and overriding claim, the company is still awaiting spectrum whereas later claimants have nation-wide licences.

To Idea’s claim that its application for UASL was turned down due to the crossholding norms, the DoT said all UASL applications have now been postponed pending Trai recommendations in this regard. Trai is likely to submit its views on mergers and acquisitions soon and is expected to relax the existing norms that do not permit any single promoter from holding over 10% stake in two companies in the same circle.

In a letter to the communications minister A Raja on July 6, Mr Aga said the company’s expansion was restricted even as competitors moved ahead. And this was because of the restriction on crossholdings which stipulated that a company or promoter could not hold over 10% stake in two competing telecom service providers operating in the same circle.

The Tatas held stake in Tata Teleservices (TTSL) as well as Idea but that did not impact TTSL expansion since the government had temporarily withdrawn this crossholding clause in 2003 and provided a concession and first opportunity to fixed services providers to convert their licences to UASL.