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Saturday, 04 June 2016 00:00
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Penalty powers for Trai after SC snub has bad optics


Historically, the telecom regulator (Trai) has, under different chairmen, been asking the government for more powers, to issue licenses and to, if need be, penalise telcos for not maintaining adequate service levels, among others. But Trai asking for such powers just after the Supreme Court snubbed it so badly on its call-drop-penalty order has really poor optics since, it looks as if the regulator wants to bypass the Court’s judgment and go ahead and levy penalties on telcos for call drops. Since giving Trai such powers requires a change in the Trai Act and means the government has to go back to Parliament, it is not going to happen in a hurry but, even when it does happen, Trai must know its penalties will still have to be reasonable and show application of mind—if not, they will either be struck down by the TDSAT or the Supreme Court. After all, when the SC struck down Trai’s call-drop order, it said ‘a legislatively pre-determined penalty, without fault or loss being established … (is) manifestly arbitrary and unreasonable’. Indeed, when the telcos argued that they were not responsible for call drops as they didn’t have either enough towers or spectrum, Trai chose to disregard this. But as SC pointed out, ‘(Trai) must respond in a reasoned manner to (comments) that raise significant problems, to explain how the agency resolved any significant problems raised by the comments, and to show how that resolution led the agency to the ultimate rule … including a rational connection between the facts it found and the choices it made’.

While it is to be hoped Trai has learned from its mistakes, in keeping with its maximum-governance-minimum-government slogan, the government in any case should look at giving more powers to Trai. But these have to be much more than just powers to penalise telcos. There is no reason why, for instance, licensing powers should remain with the government. Once the government lays down broad goals, such as at least half the population must have broadband by 2025, Trai must be in a position to issue more licenses. Since Trai has to justify all its actions in writing and have open discussion on them, as an aside, the A Raja scam of 2008 could never have occurred under an empowered Trai. The conclusion from the consultation process would have been one that plumped in favour of auctioning all spectrum, as was done in the past. Similarly, issues like getting more spectrum released, or harmonisation of the 1800MHz band, would all be issues that Trai should be dealing with. Doing this means a big step up in the capability of the regulator, but in a modern government, there is really no need for a department of telecommunications to decide on what policy should be once broad rules on transparency are laid down. An empowered Traiwould also mean that the special favours that are given to PSUs like MTNL and BSNL would no longer be available. The government relinquishing more powers in favour of independent regulators, of course, applies to more ministries than just the communications one, but this is as good a place as any to start.


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