Auction of 3G licencing: Senate body directs to remove flaws -Pakistan Press Foundation (PPF)

Paksitan Press Foundtion

Auction of 3G licencing: Senate body directs to remove flaws

* Restricts default companies from entering bidding process
* Suggests to recover $800m old dues from PTCL

By Ijaz Kakakhel

ISLAMABAD: Terming the PTCL privatisation as failure, the Senate Standing Committee on Information Technology on Tuesday directed the Pakistan Telecommunication Authority (PTA) and concerned Information Technology Ministry to invite bidding only for 3G licence and remove other words like 4G/LTE etc for its auction.

The committee, which met under the chairmanship of Senator Muhammad Idress Khan Safi has raised several observations over the auction of licence for 3G. The criteria set for the auction revealed that the whole situation was made for the facilitation of a particular group or company. They questioned that why the word 3G/4G/LTE etc was used for inviting bidding? The senators recommended that only the word 3G should be used for bidding and the remaining should be auctioned in near future so that the government may earn more money. They opposed the technology neutral spectrum and directed the PTA to incorporate amendments in the policy for limiting the auction for only 3G licences.

The committee also questioned over setting base price at $210 million (minimum price) for 3G and suggested that it should be equal to last bidding of 2G held in 2004, which fetched $291 million. The committee also expressed serious observations over mode of payment by any successful bidder, which according to the rule has to pay 50 percent payment within 30 days and the remaining 50 percent will be paid in five equal instalments in local currency.

The committee was of the view that India has also auctioned 3G licence in a very transparent manner but still its IT minister resigned over alleged kick backs over the auction process. The senators said the committee will forward its recommendation against the existing auction process of 3G and later if someone challenges in the apex court, then the Ministry of IT and PTA will be responsible for the consequences. Members of the committee observed that corporate social responsibility on the part of service providers was not up to the mark and there was a dire need to initiate public welfare schemes.

PML-N Senator Pervaiz Rashid told the committee that the government should use the word 3G, for which it’s going on to be auctioned and remove the words 4G/LTE etc, and it will be offered for auction in the future. Such a process will earn more revenue for the government. He said the whole nation was still suffering from failed privatisation process of the Pakistan Telecommunication Authority (PTCL). He apprehended that the whole process revealed that this is a manipulated bidding, aiming to facilitate specific company or group of companies. We want to create a competitive environment for auction of the 3G licence.

PML Senator Salim Saifullah Khan said we don’t have personnel interest but want to secure interest of the country. He also suggested that those companies would be allowed to take part in the auction which are not defaulters of government dues.

The committee also observed that the new management of PTCL has failed to pay the whole amount of privatisation of the PTCL and still $800 million remain outstanding. It directed the authorities concerned to take steps for immediate recovery of the amount and submit report to the committee.

Briefing the committee, Ministry of Information Technology Member Ismail Shah said as per international practice, the government is offering a spectrum of 9.8 MHz for auction. The ministry recommend the word 3G and the remaining 3G/4G/LTE etc was added by the PTA. However, he also clarified that all these are included in neutral technology as adopted by other countries. The member said the government is offering spectrum not 3G for licence.

PTA Chairman Dr Muhammad Yaseen told the committee that internationally neutral technology licence is offered for auction and not 2G or 3G or 4G. In 2004, the government auctioned neutral technology and the same method is applying now. He informed the committee that the recommendations of the committee will be incorporated but worldwide the norms are 3G/4G/LTE etc. He also informed the committee that 3G technology was supposed to come to Pakistan in 2006, but the PTCL’s sale purchase agreement became hurdles in its introduction.

Source: Daily Times