The PTA chairman said on Thursday that the process of auction of third generation (3G) licences was “anti-competitive”, but that it was the best way to go in the current circumstances.
Testifying before a parliamentary committee, Dr Mohammad Yaseen, Chairman Pakistan Telecommunication Authority (PTA) said that “it was the only option” in response to a question whether the government’s decision to bar new operators from bidding had restricted the competition.
The National Assembly Standing Committee on Information Technology, headed by Chaudhry Barjees Tahir, had asked the PTA to respond to questions about transparency the 3G auction.
Currently there are five telecom operators in the country. The government has also announced the auction of defunct Instaphone license and three licenses of 3G spectrum by March 27 and 29 respectively. If a new operator wins the Instaphone license then it will be eligible to participate in bidding for 3G licence. The committee members unanimously expressed the view that this was highly skewed in favour of existing players.
According to current policy, the new player will not be able to operate 3G before March 2013 - a condition imposed under Sale Purchase Agreement of 2006 signed between the government of Pakistan and Etisalat.
“Had the government not barred the new entrants, the Etisalat would have taken the government to the court”, Yaseen said.
“The government is damaging the country’s interests. Etisalat has withheld $800 million payments and we are unilaterally implementing the SPA”, said Anusha Rehman Khan, member of the Standing Committee. She said that Etisalat had neither brought new investment nor paid the outstanding amount and the government should take the telecom giant to court.
The committee decided to call Competition Commission of Pakistan in the next meeting to get its views on the 3G policy. The panel also decided to call Ministry of Privatisation to get latest position on $800 million outstanding dues of PTCL.
Secretary Ministry of IT, Farooq Ahmad Awan had proposed that the panel should solicit views of the CCP on competition issue. He admitted that the SPA with Etisalat had damaged the country.
Meanwhile, Prime Minister Yousaf Raza Gilani on Thursday assured stakeholders that the government would ensure fair competition in the auction of 3G spectrum technology.
Published in The Express Tribune, February 24th, 2012.
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