DoT wants to cut Trais role to size

New Delhi, Nov 13 | Updated: Nov 14 2005, 05:30am hrs
The government is likely to seek dilution of the role of telecom regulator Trai for a light touch approach towards regulation and prevent the latters indulgence in micro -management, according to the draft telecom policy.

The move to subdue Trai, created under an Act of Parliament, incidentally, comes close on the heels of the Prime Minister calling for strengthening the regulatory framework.

A process is likely to be put in place to review the activities of the regulator, thereby increasing the confidence of the industry as well as investors in the regulatory framework, says the draft new telecom policy, being prepared by the department of telecom (DoT).

In yet another salvo on the regulator, DoT has proposed that on retirement/resignation from Trai, officers would not be permitted to accept commercial employment with any telecom service provider and equipment vendor, including government agencies.

DoT is currently preparing a new telecom policy (NTP) to replace NTP 99 in view of major changes in the sector including new technologies and opening of the sector to a great extent.

Taking A Call
In a highly competitive scenario, it is not desirable to have too much regulation
Regulator should adopt a light touch approach to regulation and refrain from indulging in micro management
A process is likely to be put in place to review the activities of the regulator
The move to weaken Trai, however, may have its fallout, especially at a time when the sector is witnessing exponential growth and there is a strong need to maintain balance and ensure a level playing field among different categories of players, feel industry analysts.

They are of the view that Trai, in fact, needs to be strengthened to overcome controversial issues like interconnection between two players. Delays in this may hamper growth of the sector in a major way, they added.

The draft NTP also proposes that Trai funding would be directly provided from the revenue share collected from the industry.

A newly constituted committee with representation from the government, industry and consumers would monitor the functioning and expenditure of trai, says the draft NTP. The DoT could have made this proposal in view of the tight competition in the sector with market forces at their peak and therefore no need for regulation.

At present there are 6-8 operators in every service area, which implies that the number of service providers in a given area is much higher as compared to any international norm. As a result and as is widely acknowledged, the tariffs are much lower as compared to any international standards, it said.

In such a highly competitive scenario, it is neither required nor desirable to have too much regulation. The regulator would, therefore, adopt a light touch approach to regulation and refrain from indulging in micro management, it added.

However, there will be stronger regulatory overseeing in areas where competition is lacking and bottlenecks exist.

Trai would itself examine the impact of a regulation before it brings in a regulation, the draft policy adds.

-PTI