Rajeev Chandrasekhar and member of the Parliamentary Standing Committee on Information Technology has in a letter to the Prime Minister Manmohan Singh criticized the government’s policies in telecom sector on many fronts.

He said that some of the policy related decisions have led to led to an increase in mobile tariffs; slowdown of the rate at which teledensity and networks were expected to be rolled out; market failure, with new entrants proving to be ineffective as competitive forces; universal rural teledensity pushed out to 2020; and continued failure to meet broadband targets at a broad level.

Chandrasekhar presented a detailed analysis of the telecom sector relating to policy issues, executive decision-making, and claims made during 2011, measuring them against actual performance and documented reports/letters/recommendations by the TRAI, the DoT, the CAG, news reports and various judicial forums. The analysis shows dismal performance across each of the 26 parameters.

A more detailed analysis shows that the DoT has failed to implement major recommendations of the TRAI pending since May 2010 and February 2011 on critical issues such as spectrum allocation and pricing, M&A norms, unified licensing, delinking spectrum from licenses, and others such as collection of dues on account of excess spectrum beyond contracted amount – which is causing additional losses to the exchequer.

An independent analysis of the industry parameters in investments shows not just a sharp decline in capital investments and FDI in the telecom sector, but a deterioration across the board in most operating parameters for the industry, including levels of indebtedness, net profit margins, return on capital and average revenue per minute, minutes of usage, and ARPUs – which are either on the decline or stagnant, especially when adjusted against inflation.

Chandrasekhar points to the fact that the DoT - one year after the CAG report accusing 85 ineligible applicants of fraudulently accessing spectrum in 2008, and the TRAI recommendation for cancellation of 69 companies for failure to meet rollout obligations - has not cancelled a single license in the entire year. The proposed National Telecom Policy (NTP’2011), as it currently stands, would be delayed nearly a year from its original date of announcement. BSNL’s and MTNL’s market shares continue to decline in the profitable wireless market, while the DoT has failed to settle even basic issues such as whether the level of contracted GSM spectrum is 4.4 MHz or 6.2 MHz, which in turn has serious financial implications for the exchequer.

Additionally, officers found guilty of malpractice and misconduct in the Justice Shivraj Patil One Man Committee (OMC) report remain unaffected, with no evidence of disciplinary enquiry against them, and these and other officers in turn continue to stall multiple applications filed with the DoT under the RTI Act in a bid to stall information.

The analysis also presents that multiple claims by the government – of accusing the TRAI for not holding auctions, i