A day after the Telecom Regulatory Authority of India kickstarted process on 3G mobile spectrum, Telecom Minister Dayanidhi Maran on Tuesday favoured pricing of the scarce resource.
"Government has to make some money out of it (3G spectrum)... (and) make it very competitive," Maran told reporters after the GSM Association's meet in New Delhi.
The minister, however, did not touch upon how 3G should be priced, leaving the matter to Trai. "Government will take a decision after Trai comes out with its recommendations," he said.
Maran said India needs to learn from models being practised in various countries. "Trai has given its consultation paper and now the industry will react to it," he said.
He said the finance ministry was keen that the government got revenues from 3G services.
Maran said the government would allow foreign players to enter the 3G market.
However, Sunil Mittal, head of country's largest mobile operator Bharti, had a different view on the subject and said 'there is no justification' to price 3G spectrum.
"Contrary to the perception, spectrum is already priced... 10 per cent of revenues, 12 per cent of service tax, apart from other levies, are already there," he said, opposing any separate entry fee for 3G services.
Mittal said to make 3G services affordable, there should be no separate entry fee for 3G.
"An entry price of any kind is amortised over a period of time of the license... That's a levy the customer does not need," Mittal argued.
He said 30 per cent of the revenues of telecom companies went to the government in one form or the other and thus there was no justification of further charging 3G services.
"India must seamlessly migrate to 3G as Bangaldesh and Pakistan have done, without any entry ticket", he said.
He said if 3G spectrum was priced, it would go as cost to the customer.
However, Mittal added that if the government went ahead to charge 3G, the companies would have to pay it.
On Monday, Trai posed queries to the industry on spectrum for 3G spectrum. These included whether the present criteria of subscriber base-linked allocation of spectrum be modified for 3G mobile services.
Also, it sought an answer to the most crucial question of whether spectrum for 3G services should be priced.
This is the second time the government has sought recommendations on spectrum from Trai. Prior to this, Trai, under the chairmanship of Pradip Baijal, had submitted recommendations on 3G spectrum in May 2005 and suggested allocation of spectrum for 3G without any additional cost.
However, Tatas, one of the operators, favoured and recommended a hefty entry fee of Rs 1,500 crore (Rs 15 billion). Ministry of finance also favoured some pricing for 3G spectrum, it being a scarce resource.
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