In a quiet move, just two days before the Lok Sabha election dates were announced on March 2, the government passed an order for constituting a Group of Ministers (GoM) to look into some contentious issues regarding the auction of third generation (3G) spectrum.
The 10-member GoM headed by External Affairs Minister and Finance Minister Pranab Mukherjee will include Defence Minister A K Antony, Home Minister P Chidambaram, Agriculture Minister Sharad Pawar, Communications Minister A Raja, Railway Minister Lalu Prasad, Chemical and Fertilisers Minister Ram Vilas Paswan, Law and Justice Minister H R Bhardwaj, Minister of State for External Affairs Anand Sharma and Planning Commission Deputy Chairman Montek Singh Ahluwalia.
However, opinion is divided on the efficacy of the GoM to push through its recommendations as the Election Commission’s poll conduct rules do not permit the government to take key policy decisions. Questions are also being raised on why the government did not make the decision public though the Cabinet order was cleared on February 27.
The 3G auction process reached a stalemate after differences arose between the finance ministry and the Department of Telecommunications (DoT) on two key issues — reserve price of the spectrum and the number of blocks to be auctioned. On the reserve price, the finance ministry wanted the base price to be fixed at Rs 4,040 crore for a pan-India 3G rollout, but the DoT insisted it should be half of that. The DoT also offered a ‘compromise’ reserve price of Rs 3540 crore.
On the number of operators who would be given spectrum, the DoT had suggested up to five operators, while the finance ministry wanted all the available slots (which was up to 12) to be auctioned in one go.
The Cabinet Committee on Economic Affairs (CCEA), which discussed the issues in January, failed to come to a consensus and recommended the formation of a GoM on January 28.
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A top DoT official admitted that while the GoM might give its recommendations, the Cabinet, which has to clear them, might not be able to take any decision during election time.
However, some telecom industry executives say that the model code of conduct for the coming polls might not be applicable on the issues that are up for discussion at the GoM. A senior member of the Cellular Operators Association of India said: “The policy decision to allow 3G has already been taken. What is the bone of contention is the administrative issues.”
A similar view was echoed by Mahesh Uppal, Director, Com First (India), a telecom advisory firm: “The government merely needs to arbitrate and take a decision on the differences over some issues between the two ministries.”
An executive of a CDMA operator said: “Such decisions can only be taken after elections and by a new government.”