Conflicting regulatory policy changes irk telcos

KOLKATA: Government departments appear to be working at cross purposes in overhauling key telecom laws, which is likely to trigger more uncertainty for a troubled sector that is pinning its hopes of revival on an improved regulatory climate. On one hand, the communications and the information & broadcasting ministry is looking to repeal the archaic Indian Telegraph Act, 1885, and the Telecom Regulatory Authority of India Act, 1997, later this year by ushering in the Communications Convergence Bill.

The bill envisages a single regulator for both sectors. On the other hand, the communications ministry also plans to amend these telecom laws to ring in critical changes in telecom policy. For instance, communications minister Kapil Sibal is poised to clear the amendment of the Indian Telegraph Rules, 1951 (which falls within the ambit of the IT Act, 1885) to make it mandatory for mobile phone companies to get all telecom gear used in Indian telecom networks certified by the Telecom Engineering Centre (TEC)—the technical arm of the telecom department—from January 1, 2014.

His ministry will also move a Cabinet note shortly to amend the Trai Act to give more teeth to the sector regulator to penalize service providers, according to an internal telecom department note seen by ET. The conflicting regulatory moves have caused confusion since companies operating on both the GSM and CDMA platforms are clueless whether the proposed amendments in the Indian Telegraph Rules or the Trai Act will at all be effective if the government eventually repeals both Acts, once the proposed Communications Convergence Bill is introduced in Parliament.

"This is bizzare policy-making. There appears to be zero coordination between government departments in framing telecom regulations and tweaking laws," said Rajan Mathews, director general of the Cellular Operators Association of India (COAI), an industry body representing GSM operators like Vodafone India, Bharti Airtel, Idea Cellular and Uninor.

"What's the point of mandating TEC certification of telecom equipment through an amendment of the Indian Telegraph Rules if the mother Act is likely to be repealed in the near future" he questioned? An official from a CDMA operator seconded the views. "There is little sense in amending telecom laws which are likely to become defunct soon."

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