Achievers
Books
Business
Calendar
Community
Controversy
Cuisine
Eateries
Education
Enterprise
Faith
Good Samaritans
Health
Infotech
Media
Memories
Movies
News Archives
Opinion
Specials
The Arts

Paswan allays fears about Indian telecom

Shanthi Shankarkumar

All summer flights from New Delhi seem to lead to the USA -- at least those carrying ministers. And so Mahajan, Panja, and Yashwant Sinha all visited the US last month, doing the rounds at San Francisco, Chicago, New York, and Washington .Now it is the turn of Minister of Communications Ram Vilas Paswan to spin out the hardsell.

He is accompanied by a high-powered delegation, comprising senior officials from the government of India and representatives from the Federation of Indian Chambers of Commerce and Industry.

The main purpose of Paswan's visit is to allay fears about the India telecom industry and to assure potential investors that India, with its trade and investment policies and incentives for foreign collaboration, is the right place to be in now.

In Chicago, Paswan and his delegation met with officials at Motorola and Lucent Technologies.

After discussions in San Francisco with IT biggies it was decided that yet another NRI advisory committee would be set up -- to look into problems like bandwidth.

"One major problem is bandwidth, without adequate bandwidth IT cannot flourish. With the opening up of national long distance services, both private and public sector companies will provide bandwidth. That is a message we wanted to bring here," said Paswan.

Back in India, Paswan has been facing flak for his decision to give free telephone connections to 320,000 telecom employees, and has earned sobriquets like Mr Phone Mantri, Populist Paswan etc., for his largesse. At a time when the Department of Telecom Services is on the verge of being corporatized -- in October this year -- Paswan has been accused of adding another liability to the restructuring plan. It is a charge Paswan claims is ridiculous.

"I don't want to be on the defensive, but our aim is not only to make profits. We are a welfare state. These are the employees who have built up the institution for the last 100 years. It has been reported that it is going to cost us Rs 12 billion when it is going to cost us only be only Rs.660 million," he said.

"There is a lot of misunderstanding about the figures. We had planned to give telephones on demand in any case by 2002, so the cost of installing lines is not an additional cost. There is already the existing infrastructure, so maybe a few additional connections will have to be given... The rent is roughly Rs 2000 per year, so for 320,000 employees, it works out to about Rs 660 million. Then there is a one-time installation cost of Rs 800 that works out to Rs 240 million for 300,000 connections.

"Last year we generated revenues of Rs 75 billion, so this is one department that is totally self-sufficient," said Shyamal Ghosh, secretary, Department of Telecommunications.

Paswan said the government hopes to bring teledensity up from 2.5 to 7 per 100 in 2005 and to 15 per 100 by 2010. The government requires $ 38 billion and $ 70 billion respectively to achieve those figures.

"We want the private sector to help the government to achieve this task, that is why we decided to convert the DTS into a corporation and give everybody a level playing field," he said.

Saying the government believed in 'service and access', Paswan said 'Sanchar Dharas' or Communication Centers would be set up in each panchayat, offering Internet and phone facilities. By 2002, the government hopes to cover every village in the country by telephone.

Virtual Private Networks will be set up in the Call Centers that will be set up by IT operators, said Ghosh. This would help in bringing in two-way voice facilities, something that can't be implemented now due to the tariff difference between national, international and local calls.

Long-distance services are also being privatized but this time around the government hopes to avoid the mistakes it encountered when it first considered privatization. Then there were miscalculations about the revenue, so many operators were unable to pay the fixed license fee.

"We are now thinking of a 'Migration Package', which will enable fixed license fee operators to move to a revenue-sharing fee... For long distance calls, we are considering 3-4 options. There is no unique option that can be applicable in every circumstance... Long-distance tariff will come down. We know there will be four or five players who will share the basket. We are in the process of finalizing a system whereby we can eliminate irrational bids, and eliminate competition in a transparent manner because we are answerable to Parliament... We are learning our lessons of the past," he said.

Previous: Fusion fashion

Next: US administration differs with terrorism panel on Pak

Tell us what you think of this report